The Securities and Exchange Board of India on 12th October 2022, has notified the Standard Operating Procedure for inter-operable Regulatory Sandbox (IoRS) in order to facilitate testing of innovative hybrid financial products / services falling within the regulatory ambit of more than one financial sector regulator and to obviate the need of innovators, to engage with different regulators regarding their hybrid product, a common window has been made available.
Financial products / service providers whose business models / activities / features fall within the remit of more than one financial sector regulator, shall be considered for the testing under IoRS. FinTech Department of RBI shall act as nodal point for receiving applications under IoRS and shall be designated as ‘Coordination Group (CG)’ for IoRS. All the necessary secretarial support shall be provided by them.
The application for IoRS shall be on ‘on tap basis’ in a prescribed application form. The RS framework of the regulator under whose remit the ‘dominant feature’ of the product falls, shall govern it as ‘Principal Regulator (PR)’. The regulator/s under whose remit the other features apart from the dominant feature of the product fall shall be the ‘Associate Regulator (AR). The entities meeting the minimum eligibility criteria for participating in the RS of the Principal Regulator, may apply, along with requisite documents through email at iors@rbi.org.in.
In order to keep the IoRS process simple and non-disruptive, detailed scrutiny of the application shall be done by the PR based on its own framework. The PR shall coordinate with AR(s), regarding the features of the product, which falls under their remit.
