SEBI moots sandbox policy for tech firms; what it is, how it will benefit financial markets – The Financial Express

Capital market regulator Securities and Exchange Board of India (SEBI) is planning a sandbox policy to support technology developments in financial markets. We take a closer look.We will come out with a sandbox policy. We are examining whether any changes in laws are required in terms of its dispensation, SEBI Chairman Ajay Tyagi said.Capital market regulator Securities and Exchange Board of India (SEBI) is planning a ‘sandbox policy to support technology developments in financial markets. We will come out with a sandbox policy. We are examining whether any changes in laws are required in terms of its dispensation, SEBI Chairman Ajay Tyagi said on the sidelines of an event organised by IIM-Calcutta. How will this new policy benefit tech companies?The ‘sandbox’ policy is being planned in order to bolster innovation in the capital markets by technological intervention. Notably, the Sandbox policy will allow companies to test products in a closed environment, a particular geography or among a set of users, before they are allowed roll out commercially meeting all regulations. SEBI Chairman Ajay Tyagi noted that this will enable the tech companies to work on innovations without regulatory changes. He said there had been huge technology interventions in capital markets in the past and it would continue.Also read: PSU Bank recap part 2: Modi govt seeks Parliament nod for additional Rs 41,000 croreSuch a sandbox approach will allow the firms to experiment and test certain innovative products even before filing for approval or registration of the same. Depending on the success of the experiment the respective tech firms companies can then decide whether they would want to go ahead and seek approval for the same. Notably, such an approach will not only promote innovation, but also reduce failures. Interestingly, Tyagis response came in response to a question on the regulator’s view on crypto assets. Currently, Indian regulations do not accept cryptocurrency as a valid currency. According to a PTI report, markets regulator SEBI had sent its officials to foreign countries to study initial coin offerings and cryptocurrencies, a move that aimed at understanding of the systems and mechanisms. Cryptocurrencies are digital units in which encryption techniques are used for trading and these ‘currencies’ operate independently of a central bank, while initial coin offerings are equivalents of initial public offerings in stock markets.Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

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