On June 26th, 2019, the Global Financial Innovation Network (GFIN) published its “One Year On” report, looking back at its first year of activity and identifying key challenges, achievements and objectives for the future.
The primary objective of the GFIN was to help innovative firms interact with regulators in a more efficient way, supporting them as they look to scale and test new ideas across different jurisdictions. As stated in the report, “it also created a new means of co-operation between financial services regulators to work on innovation-related topics, sharing different experiences and approaches”.
As of June 2019, members of the GFIN include 35 financial services regulators from 21 jurisdictions as well as 7 so-called “Observers”, non-regulator participants such as the IMF and the World Bank Group.
During its first year of activity, the GFIN has committed to expanding its objectives from the original focus of facilitating responsible cross-border experimentation of innovative ideas to now include various other forms of regulatory collaboration. Since the UK’s FCA first consulted on the idea of creating a “global sandbox” in early 2018, the scope of the Network has expanded sensibly, as the group recognised that the sandbox was only one tool among many available strategies to support innovation on an on-going basis.
Timeline and activities overview
February 2018: Global Sandbox proposed
March 2018: Regulators come together to discuss initiative in London
August 2018: The Global Financial Innovation Network is created + consultation issued
October 2018: First GFIN meeting in Hong Kong
January 2019: Official launch of the GFIN + Agreement on the GFIN government structure + Terms of Reference agreed and issued
February 2019: Cross-border applications opened
April 2019: Firms under consideration for the cross-border pilot announced
May 2019: GFIN annual meeting in London consultation
In August 2018 three main “workstreams” were introduced as areas of special focus for the Network:
1. Acting as a collaborative group of regulators sharing experiences of innovation in their market
2. Providing a forum for joint work and regulatory trials (e.g. RegTech)
3. Providing firms with an environment in which to trial cross-border solutions
Of particular interest is the RegTech stream, which focuses on sharing RegTech knowledge and collaborating on areas of mutual interest such as potential cross-jurisdictional efficiency (e.g. machine executable regulations).
A key part of the GFIN’s work over the next 12 months will be to focus on how they can support emerging markets to help define, shape and develop their respective regulatory markets approach to innovation. The next GFIN Coordination Group will be meeting in Montreal in October 2019.
At Know Your Customer, we are extremely supportive of any initiative fostering tighter international cooperation and better collaboration between innovative RegTech firms and regulators. To never miss a story about similar initiatives from around the world, make sure to follow us on Twitter and LinkedIn and sign up for our newsletter.