Last year, the Global Financial Innovation Network launched the pilot phase of its cross-border testing scheme. Twelve months on, none of the applicants have been able to meet the standards required to launch a full cross-border test. Against this backdrop, GFIN has made three changes to support the first official cohort.
GFIN: what’s the big idea?
The Global Financial Innovation Network was established last year. It has since grown to comprise over 50 organisations from across the globe. Its objectives include assisting innovative firms with cross-border testing and it launched a pilot “global sandbox” to support that.
Pilot applicants not yet ready for cross-border testing
No winners this time
A year into the pilot, GFIN has released a report on its lessons learned, revealing that it is unable to take forward any of the applicant firms to begin testing.
Failure to attract fully operational firms
This result may in part be due to the scheme’s failure to attract fully operational firms. In particular, GFIN commented on the “lack of applications from large or international firms”. Instead, many of the applicants seem to have been at preliminary stages of implementation and/or lacking the necessary partnerships outside their home jurisdictions.
Different interpretations of cross-border testing
GFIN was also expecting applicants to test a single solution spanning multiple markets. However, in the absence of a clear definition, many applicants were looking for different types of support – for example, introductions to foreign regulators or the ability to test the same activity across different jurisdictions and compare the results.
Three new solutions for three key issues
Despite the challenges, GFIN remains committed to establishing a thriving cross-border testing environment. To refine its service ahead of the official launch, it has put in place three new solutions to tackle three key issues emerging from the pilot.
- GFIN Website. Previously, information about GFIN was hosted on individual regulators’ websites. A GFIN website has now been created, to provide a single source of information and streamline communications.
- Regulatory Compendium. The pilot revealed some confusion as to what types of activity different regulators could support in each jurisdiction. This new compendium is intended to provide more clarity around this issue.
- Single application form. In the pilot phase, firms were required to submit separate applications to all relevant regulators, which resulted in duplicative efforts and logistical challenges. The next cohort will be invited to apply through a single global application form.
With these new tools in hand, GFIN will be opening applications for its first official cohort in the first half of 2020.