You won’t be surprised to know that the Monetary Authority of Singapore (MAS) completely operates the financial sector in Singapore. Moreover, few of its regulations can prove to be the restrictions for the start-ups to enter with innovative ideas. To fight this situation, the Monetary Authority of Singapore (MAS) has granted many businesses to experiment and test their product or services within the provided duration and well-defined space with fewer compliance standards.
If you are also an entrepreneur seeking to establish a financial technology business in Singapore, then you should consider joining the MAS FinTech Regulatory Sandbox.
This article is all about the MAS FinTech Regulatory Sandbox, benefits, and several related things that will guide you to the right path.
What is the MAS FinTech Regulatory Sandbox?
The FinTech regulatory sandbox grants several businesses and industries to test several innovative financial products or services in the financial field but within the provided time and explicit space. The Monetary Authority of Singapore (MAS) provides such businesses great support to ease several regulatory and legal requirements for the duration of the Sandbox (i.e., at least six months).
This sandbox will also involve some relevant safeguards, which contain some of the possible situations of the failure of businesses and its minimal impact on the Singapore financial system. However, a sandbox express entity needs to elaborate the customers regarding managing the outstanding trade and do business needs to terminate.
What are the Benefits of Joining the MAS FinTech Regulatory Sandbox?
The sandbox grants the Monetary Authority of Singapore (MAS) to ease several legal and regulatory requirements for all the concerned businesses and industries, including cash balances, assets maintenance, and prerequisite related to the credit ratings. However, regulatory and legal prerequisites need to be relaxed based on the characteristics of the product and testing.
As a result, the standard requirements are relaxed for such types of businesses, which then lead to reducing the cost of compliance and thus offer greater flexibility for operating business.
Get Fast & Accurate official notarization for ICA, MOM, MFA.
What are the Options for Joining the MAS FinTech Regulatory Sandbox?
Basically, there are only two types of sandbox options. Two of them are:
- The Sandbox Express; and
- The regular Sandbox.
Both sandbox options provide a space to test your products, but the greater differentiating factor among both sandbox options is the sandbox’s customizability.
The Sandbox Express
The Sandbox express is especially for the testing products in which the risks are minimized and favorable for the financial market. However, the duration of the sandbox express is also very short i.e.6 months. As of now, the sandbox express is only available for:
- Those intending to operate business as an insurance broker
- Developing or operating the functionality of the developed market.
The sandbox express is for those who are imposing disclosures predetermined rules and requirements, whose product testing quickly get approved by the Monetary Authority of Singapore (MAS). The only disclosure requirements for the business in the sandbox express option are that it will need to reveal such requirements to all the potential customers:
- For those individuals who are currently operating in the sandbox for the approved period along with,
- The motive and the limitations of the activities
Basically, the Monetary Authority of Singapore (MAS) will be required to complete the entire assessment of the suitability of the sandbox for the product testing and provide the outcome within 21 days. However, you need to comply with all the conditions strictly. However, if there is any breach in the requirement it might lead to the Monetary Authority of Singapore (MAS) eliminating the Sandbox.
The regular Sandbox
If the business model or the product is a bit complicated, then going with the regular sandbox can be the ideal choice that might suit your needs. The regular sandbox is another sandbox option that offers you substantial customization about the relaxation of the various regulatory and legal requirements. Moreover, this also allows several businesses and industries to properly balance the benefits and potential risks of the testing, enhancing the chances of success.
Whenever you intend to apply, you might always specify your preferred sandbox duration in the application provided to the Monetary Authority of Singapore (MAS). This needs to be supported by the relevant details of the testing, like risk management.
How to Apply to Join the MAS FinTech Regulatory Sandbox
To participate in the MAS FinTech Regulatory Sandbox, your company must meet the following eligibility requirements:
The Sandbox Express
In order to apply for the sandbox express option, you will require completing the application forms, which you can easily download from the monetary authority of the Singapore website. Luckily, you do not require to pay any fees for an application form. However, you need to submit the application form after completion directly to the Monetary Authority of Singapore (MAS) through email to fintech_sandbox@mas.gov.sg.
The regular Sandbox
If you wish to apply for the regular sandbox option, in that situation also you will require to complete the separate application form, which you can easily download from the Monetary Authority of Singapore (MAS) website. In this application form also you do not require to pay any fees.
In case your business is an existing Monetary Authority of Singapore (MAS) regulated financial institution, in this case, you need to submit the application directly to the Monetary Authority of Singapore (MAS) reviewing officer. In every step of Application submission, you need to submit the application via email to fintech_sandbox@mas.gov.sg.
Hire a Language translator for converting your legal & Other Documents.
Any sandbox option you choose, you will always receive a cooling-off duration of three months in terms of rejected applications. In simple words, if the Monetary Authority of Singapore (MAS) declines your sandbox application, they will not accept the application from the same application within the same period.
Cooling off period is specially meant for those applicants to perform more extensive due diligence. However, also rework the business model to enhance the value of the business prior to submitting the new application.
What Happens At the End of the Sandbox Period?
Upon the end of the sandbox period, the regulatory and legal requirements relaxed by the Monetary Authority of Singapore (MAS) will also expire. Therefore, your business will leave the sandbox, and you need to fulfill all the specified regulatory and legal requirements.
If both your business and the Monetary Authority of Singapore (MAS) are well-pleased that Sandbox has finally acquired its desired best outcomes, in that situation, your businesses might proceed further to set up new products or services as per the testing on the larger scale.
However, if your business fails in fulfilling the regulatory and legal requirements, in that situation, the sandbox will get discontinued, and the product or service cannot be set up further. So now you need to proceed with making a new application for extending the sandbox duration.
Can the Sandbox Period be extended?
In most situations, the sandbox gets expired on the specified date even if the various businesses failed in complying with the provided regulatory and legal requirements by then.
However, you have the option to make the application for the extension of the sandbox duration. You need to make the extension application in advance if you think your business will fail to fulfill the existing regulatory and legal requirements upon leaving the Sandbox. Also, make sure that you need to file the extension application at least one month prior to the specified expiry date.
The application for the extending sandbox duration is checked on a case-by-case basis, and the Monetary Authority of Singapore (MAS) will only approve the application if there is a genuine reason for doing so. However, the Monetary Authority of Singapore (MAS) might also approve the extension application if your business requires extra time to receive feedback from the customer or to correct few faults in the product prior to leaving the Sandbox.
Hire our translators for certified translation service
Hopefully, after reading the above article, you might have understood all the details related to the MAS FinTech Regulatory Sandbox and a few of its benefits and regulatory requirements associated with it. However, it is suggested to read each detail carefully before proceeding further.
For a high-quality business translations agency, Singapore translators can be the ideal choice. At Singapore translator, we have a professional translator team that believes in delivering you certified translation at a competitive price. So no matter you are looking to translate your Chinese or any other foreign language documents. Our best team of translators in Singapore has got you covered. Along with such, you can also pay for notary public translations at our reputed translation agency.
