FCA unveils first inductees to fintech sandbox

Initial group of firms that will test out their products and services includes three brands looking to transform corporate finance

UK regulator the Financial Conduct Authority (FCA) has revealed the first group of companies that will test out their ideas in its fintech regulatory sandbox.

The organisation announced the initial ‘cohort’ of 24 firms on the second anniversary of its Project Innovate scheme, designed to encourage novel financial technologies that work in the interests of consumers.

Established and emerging providers mingle on the list, and three market entrants in particular will trial online services with direct links to corporate finance:

  1. Nivaura, a platform that uses automation and blockchain for the issuance and management of private placement securities;
  2. Issufy, a web portal that streamlines the initial public offering distribution process for stakeholders such as investors, issuing firms and their advisers; and
  3. Otonomos, a firm that represents private companies’ shares on the blockchain, enabling them to manage shareholdings, conduct online book building and facilitate transfers.

Other eye-catching concepts in the group include:

  • Tramonex, a distributed ledger e-money platform that facilitates the use of ‘smart contracts’ to transfer donations to charities; and
  • Govcoin Ltd, a technology provider that has teamed up with the Department for Work and Pensions (DWP) to determine the feasibility of making emergency payments using means other than cash, or the Faster Payments Scheme. Its blockchain-based payments system will enable the DWP to credit value to a mobile device, which can then be transferred directly to a third party.

Among the longstanding household names in the first cohort are Lloyds Banking Group, HSBC and Citizens Advice, who are trialling solutions related to personal financial management, debt management and in-branch customer experiences.

FCA executive director of strategy Christopher Woolard said: “The FCA’s regulatory sandbox was a first for regulators worldwide, and underlines our deep commitment to innovation and our willingness to think outside the usual regulatory parameters. We are pleased to announce the first cohort of firms.”

Getting to that stage, he added, “has been an intense process for both firms and ourselves… we are grateful for their cooperation and hard work.

“We look forward to these businesses bringing new products and services to market, while we ensure that appropriate consumer protection safeguards are in place.”

Firms can apply to be part of the second sandbox cohort from 21 November this year to 19 January 2017. The FCA is inviting applications from firms of all sizes.

The regulator says that the test design period for cohort two will take around 10 weeks, so it would expect that all accepted firms will be ready to begin testing their ideas in May 2017.

Application details can be found here.

Scroll to top