Sandbox Licensing Now Live In Ghana Via EMTECH Platform. Here’s How To Go About It
The Bank of Ghana has opened its Regulatory and Innovation Sandbox, which was created in partnership with EMTECH Solutions Inc.
The decision, according to a statement from the central bank, is consistent with the bank’s objective to continually create a favourable regulatory framework that supports innovation, financial inclusion, and financial stability.
“The Regulatory Sandbox is open to all licensed financial institutions and unlicensed FinTech start-ups that have innovative products, services or business models that meet the Regulatory Sandbox requirements,” the statement said.
Who Can Apply For The License?
The new licensing regime will be available to:
- To banks, specialised deposit-taking institutions and payment service providers including dedicated electronic money issuers.
- Unregulated entities and persons that have innovations that meet the sandbox requirements.
However, the entities above still need to show that:
- Their digital business models are new and are not currently covered explicitly or implicitly under any regulation in Ghana.
- Their digital financial service technology is still new and immature; and
- Their Innovative digital financial services products have the potential of to address a persistent financial inclusion challenge.
“Within the broad categories outlined, the Bank of Ghana would give preference to products and services leveraging blockchain technology, remittance products, crowdfunding products and services, e-KYC (electronic know your customer) platforms, RegTech (regulatory technology), SupTech (supervisory technology), digital banking, products and services targeting women financial inclusion and innovative merchant payment solutions for micro, small and medium size enterprises (MSMEs),” the bank said.
What Is The Purpose Of The Regulatory Sandbox Regime?
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With the new regulatory sandbox license, Bank of Ghana seeks to:
- Reduce time-to-market for unregulated products;
- Allow regulators to learn about innovations faster;
- Encourage innovators to formalize their business and incentivise incumbents to experiment with new ideas;
- Reduce the cost of innovation for innovators; and
- Provide valuable insight for regulators to evolve effective regulations.
Bank of Ghana’s latest move comes on the heels of the recent blocks placed by Nigeria’s central bank on cryptocurrency trading and the facilitation of international remittances by startup companies. Apart from Mauritius and Nigeria, Tunisia is has more recently launched a regulatory sandbox regime.
How It Will Work
The sandbox licensing regime is available to Ghanaian innovative startups through a partnership between Bank of Ghana and EMTECH. As a result of the partnership, the Bank of Ghana has become the first central bank to adopt an API-first Digital Regulatory Sandbox.
“The sandbox will be available to banks, specialised deposit-taking institutions and payment service providers including dedicated electronic money issuers as well as unregulated entities and persons that have innovations that meet the sandbox requirements,” an earlier statement from the Bank of Ghana read.
The entire regulatory sandbox regime can be done here: https://app.emtech.com/home
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh