Seventy innovators are currently testing different financial technology innovations with the Capital Markets Authority(CMA).
CMA says the innovators under the regulatory sandbox programme are at different stages of implementation under its incubation platform known as regulatory sandbox.
The regulatory sandbox is expected to be incubation like programme where innovations are nurtured.
To help with the growth of innovation in the financial system, the authority has unveiled regulatory sandbox guidelines to help in the development exercise.
Here, innovators would be exempted from most of the stringent regulations of the capital markets.
This includes a pilot for firms wishing to test innovative products, services or business models across more than one jurisdiction.
Last year, the CMA embarked on drafting guidelines to give innovators in the financial sector a platform to harness their innovations.
CMA says so far more than 70 fin-techs have enrolled on the platform offering solutions to various issues in Kenya’s financial market.
The regulatory sandbox has been practiced in other jurisdictions like Australia, Canada, South Africa, the United Kingdom and Rwanda with notable success.
The guidelines provide that an applicant to the regulatory sandbox must be a company incorporated in Kenya or any other East African state.
An applicant is required to have an innovative product which it intends to offer following a successful exit from the sandbox.
An applicant will also be required to list the potential benefits of the proposed product, a projected plan and clear strategy for exiting the sandbox and safeguards for avoiding potential harm to investors or the capital markets.