British Virgin Islands cryptocurrency license
BVI innovative Fintech products – new regulations
BVI innovative Fintech products – June 2020
The Financial Services (Regulatory Sandbox) Regulations, 2020 (the Regulations) were introduced in June 2020 and commenced on 31 August 2020. The Regulations are intended to provide a way for new, innovative fintech products to be trialled for a limited time by BVI companies, without the need to comply with the more onerous licensing requirements set out in more mainstream financial services regulations.
Innovative Fintech definition
“Innovative Fintech” is defined in the Regulations as ‘The development or implementation of a new system, mechanism, idea, method, or other arrangement through the use of technology to create, enhance or promote a product or service with respect to the conduct or provision of a financial services business’.
In this context, financial services business relates to activities that would usually fall to be regulated and licensed, such as fund management, banking, money services, and operating an investment exchange. Where an entity that is engaged in innovative fintech is permitted to operate within the regulatory sandbox (the sandbox), such licensing requirements do not apply for so long as the entity is within the sandbox.
Learn more about the BVI Innovative Fintech Products – new regulations
Application and approval
a written indication that the applicant is utilising or intends to utilise innovative fintech whereby the product or service is innovative and has the potential to:
- (a) improve accessibility, efficiency, effectiveness, security and quality in the
provision of financial services business;
- (b) enhance the efficacy, efficiency and effectiveness of the management of risk by persons licensed, authorized or otherwise approved by the FSC to engage in financial services business; or
- (c) address shortcomings in, open up new opportunities in, or promote, the conduct or provision of financial services business.
a detailed and comprehensive business proposal;
a written indication of the test scenarios the applicant has carried out, based on the applicant’s business model, to demonstrate the usefulness, functionality and potential of the product or service, including the projected outcomes of the test scenarios and the appropriate indicators to be used in measuring such outcomes;
a statement of the maximum number of clients the applicant will have or engage while in the sandbox;
a written description of the risks that may be associated with the applicant’s business model and the framework established or to be established to ensure an adequate management of the risks;
a written indication of the resources (financial, technological, human and otherwise) at the disposal of the applicant which the applicant intends to use to support participation in and testing within the sandbox, including ensuring the appropriate control and mitigation of potential risks and losses arising from offering the product or service that is the subject of innovative fintech; and
written strategies for existing the sandbox, both (a) without seeking a license under mainstream regulatory legislation, and (b) by transitioning to being a licensed entity, including an indication of the potential to realistically deploy the innovative fintech with respect to financial services business after the applicant has ceased to participate in the sandbox.
1. indicate the participant’s level of compliance with the Regulations;
2. state the number and classification of the participant’s clients;
3. state the aggregate monetary exposure of the participant’s clients;
4. provide a summary of the participant’s clients by geographical location;
5. outline the financial position of the participant;
6. indicate risks that have been encountered and how they have been resolved or are being resolved, including whether there has been any financial or other loss;
7. outline key performance indicators, achievements and any relevant statistical information;
8. outline any significant complaints (if any) by clients and how they were resolved (or, if they have not been resolved, the plan put in place to resolve them); and
9. where the test in the sandbox has failed, the lessons learnt by the participant, or where the test in the sandbox has been successful, the participant’s plan after exiting the sandbox.
What is Fintech?
What is Fintech?In short, it is an industry that uses technology to improve financial products and services. From mobile payments and peer-to-peer lending to robo-advisors and Bitcoin, fintech companies are helping us bank, borrow, save, and invest in new ways. So whether you’re looking to make your finances more efficient or you’re interested in investing in the next big thing, keep an eye on the exciting world of fintech.
Our company licensing services
— What we do and do not do
Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.
TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!
Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.