Abu Dhabi Global Market is asking the public for feedback on its plans to set up a financial technology (fintech) incubator in the capital’s financial free zone.
The call is part of the strategy to make Abu Dhabi a centre for the fast-growing fintech industry, in which banks and other financial institutions use digital and internet-based techniques for transactions and bookkeeping.
The global value of fintech investment has expanded threefold in the past three years and could be worth as much as US$12 billion by 2018, industry experts estimate.
ADGM’s regulator, the Financial Services Regulatory Authority (FRSA), has issued a public consultation paper inviting feedback on its recent proposals for a FinTech Regulatory Laboratory (RegLab), a regime designed to support companies, institutions and participants that are looking to deploy innovative technology within the fin tech sector.
Fintech companies will be able to use a lighter regulatory framework than the full ADGM rule book for up to two years to incubate their products. After that time, those who have demonstrated viable business models will transfer to full regulation. Those that are not ready will exit the RegLab structure.
ADGM said: “The regulatory approach adopted allows the FSRA to retain flexibility in tailoring its regulatory requirements based on the specific characteristics and risks posed by a specific FinTech participant.
Richard Teng, chief executive of FSRA, said: “We were very pleased to receive positive and constructive feedback from local and international participants on our earlier policy consultation of the FSRA Reglab initiative. The global fintech hubs have also been supportive in our initiative to develop a progressive and sustainable FinTech eco-system in this region.
“We will continue to welcome firms to create and deploy new technologies, create new growth opportunities and enhance the quality and efficiency of the financial services sector in Abu Dhabi,” he added.
Interested parties have until September 26 to submit their comments on the proposals to ADGM.
fkane@thenational.ae
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