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7. Eligibility Criteria

7-1

Applicants shall meet the following defined eligibility criteria:

 

 

(a)

The product, service, solution, or business model shall demonstrate the following:

 

 

 

 

(i)

it shall relate to financial products and/or services that either may impact on the Central Bank’s objectives or otherwise may be a Licensed Financial Activity;

 

 

 

 

(ii)

be innovative, in terms of the technology used in the product, service, solution or business model, or it utilises existing technology in an innovative way;

 

 

 

 

(iii)

benefit for Consumers and/or the financial services industry (such as promoting growth, improving efficiency, mitigating risk, providing more options, encouraging social development, etc.);

 

 

 

 

(iv)

exhibit a genuine need for testing within the Regulatory Sandbox; and

 

 

 

 

(v)

an intention by the Participant to deploy the proposed financial service in the UAE on a broader scale after exiting the Regulatory Sandbox, subject to complying with all regulatory requirements.

 

 

(b)

The Applicant shall demonstrate that it complies with, and will continue to comply on an on-going basis with, the following:

 

 

 

 

(i)

appropriate financial soundness requirements as determined by the Central Bank;

 

 

 

 

(ii)

readiness to test the innovation in the live market with real Consumers;

 

 

 

 

(iii)

willingness for market wide deployment of the innovation, post testing;

 

 

 

 

(iv)

possess relevant technical, technological and business knowledge and experience;

 

 

 

 

(v)

have a bank account in a UAE based Bank, if required by the Central Bank depending on the nature of the product, service, or solution being tested;

 

 

 

 

(vi)

its owners, directors, senior officers and any other key person, as determined by the Central Bank, meet such ‘Fit and Proper’ requirements as determined by the Central Bank relating to integrity, competence, financial solvency and legal capacity; and

 

 

 

 

(vii)

written consent must be obtained from the Consumer that states that the Consumer:(i) clearly understands the risks; (ii) has explicitly agreed to participate in the experiment; and (iii) acknowledges that they will not be subject to the Consumer Protection Regulation. The Applicant shall disclose all risks to the Consumer in a clear, fair and not misleading format prior to the Consumer providing its written consent under this paragraph. The risk disclosure shall reference the possible financial risks and all other potential risks that a Consumer could face and shall provide a summary of the regulatory protections the Consumer agrees to forego under the Consumer Protection Regulation.

 

 

(c)

The Applicant must provide the Central Bank with a written commitment to fully comply with these Conditions and other Central Bank requirements on an ongoing basis.

7-2

The following information shall also be provided with the application:

 

 

(a)

defined test scenarios and expected outcomes of the proposed Regulatory Sandbox experiment;

 

 

(b)a comprehensive operational readiness and testing plan that identifies key milestones, a timeline, and likelihood of achieving target outcomes;

 

 

(c)

defined exit strategy for discontinuation of the product, service, or solution and defined transition strategy for market wide launch of the product, service, or solution;

 

 

(d)

a structured plan for regular reporting that includes a concise and comprehensive format which shall clearly outline the essential metrics and parameters to be utilised, as well as the methodology for analysing such parameters during the testing process;

 

 

(e)

defined client acquisition and communication strategy;

 

 

(f)

a robust wind-down plan;

 

 

(g)

distinctly identified and assessed potential risks for Consumers and the financial market along with appropriate mitigation strategies; and

 

 

(h)

the content of clear disclosures on testing objective(s), expectation(s), compensation and potential risks applicable to all Consumers participating in the Regulatory Sandbox.