The Global Financial Innovation Network (GFIN)
The Guernsey Financial Services Commission (“GFSC”) has, in collaboration with 11 financial regulators and related organisations, on 7 August 2018 announced the establishment of the Global Financial Innovation Network (GFIN), building on a proposal earlier this year to create a ‘global sandbox’.
As part of the consultation, the group is seeking views on the mission statement for the GFIN, its proposed functions, and where it should prioritise activity. The group is also keen to hear from other interested regulators or related organisations who wish to get involved.
The network will seek to provide a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale new ideas. It will also create a new framework for co-operation between financial services regulators on innovation related topics, sharing different experiences and approaches.
The consultation sets out the three main functions of the GFIN:
- act as a network of regulators to collaborate and share experience of innovation in respective markets, including emerging technologies and business models;
- provide a forum for joint policy work and discussions; and
- provide firms with an environment in which to trial cross-border solutions.
We are keen to hear from all interested parties on the mission statement, how this network will work in practice, what this network should prioritise and focus on to encourage innovation in the right way and ideas for how regulators and other stakeholders can work together to take it forward.
The establishment of the GFIN follows an initial consultation on the idea of a ‘global sandbox’ in February 2018. 50 responses were received to this consultation. Overall, feedback to the consultation was positive. Key themes to emerge in the feedback were:
- Regulatory co-operation: Respondents were supportive of the initiative providing a setting for regulators to collaborate on common challenges or policy questions firms face in different jurisdictions.
- Speed to market: Respondents cited one of the main advantages for the global sandbox could be reducing the time it takes to bring ideas to new international markets.
- Governance: Feedback highlighted the importance of the project being transparent and fair to those potential firms wishing to apply for cross-border testing.
- Emerging technologies/business models: A wide range of topics and subject matters were highlighted in the feedback, particularly those with notable cross-border application. Among issues highlighted were artificial intelligence, distributed ledger technology, data protection, regulation of securities and Initial Coin Offerings (ICOs), know your customer (KYC) and anti-money laundering (AML).
Feedback submitted to these email addresses will be shared among the organisations listed below, unless specified otherwise.
The organisations involved in the GFIN at present are:
Abu Dhabi Global Markets;
Autorité des marchés financiers (Québec);
Australian Securities & Investments Commission;
Central Bank of Bahrain;
United States Consumer Financial Protection Bureau;
Dubai Financial Services Authority;
Financial Conduct Authority;
Guernsey Financial Services Commission;
Hong Kong Monetary Authority;
Monetary Authority of Singapore;
Ontario Securities Commission; and
Consultative Group to Assist the Poor (CGAP).