The Financial Services sector is a major contributor to the Maltese Economy when all economic effects are taken into account. In fact, the sector as a whole has been estimated to account for 11.2% of total Gross Value Added ('GVA') and 10.2% of employment, ranking with the highest contributors of the Maltese economy1. As innovation drives growth, the Malta Financial Services Authority ('MFSA') has launched its Fintech Regulatory Sandbox, which is an essential Research and Development tool for testing innovative, technology-enabled solutions, in a controlled environment.
The main scope of the Sandbox is to, inter alia, promote:
an increase in efficiency and user experience, a decrease in cost, new business models, applications or products, identification of any inherent regulatory gaps, challenges, and risks. Applications may be submitted on an ongoing basis and the lifecycle of the Sandbox consists of the following stages:
applicants submit their proposal to the Authority through the online proposal form, the Authority determines whether the Applicant falls within the scope and eligibility criteria, authorisation by the Authority under the applicable law and requirements as set out in Rule 3 of the MFSA Act, testing phase, submission of a report to the Authority highlighting the performance of the Solution, a decision by the MFSA on whether the Participant will continue to operate within the Sandbox or whether to implement the appropriate exit strategy.
Footnote
1. https://www.mfsa.mt/wp-content/uploads/2019/01/16_1428510692_Contribution.pdf, p. 24
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