Securities and Exchange Board of India (SEBI) - the Stock market regulator of India, on 17th February, 2020 (Monday) has approved the live testing of the newly launched fintech products, services and business models made available by the market players to help in the facilitation of the use of latest upcoming innovations in capital markets. 

All registered entities enlisted under SEBI will be eligible to participate in the live testing simulation where the basis of new product processes, services and business models can be deployed on a limited set of eligible and interested customers for a specific period of time with certain rules and guidelines that will be applied in a relaxed manner. The SEBI board has also decided to allow the approach of cross domain initiative under which a regulated entity can test solutions for activities that have not been yet registered. 

"This concept of limited registration will facilitate entities to operate in a regulatory sandbox without being subjected to the entire set of regulatory requirements to carry out that activity," SEBI said.

The regulatory body have also said that an individual investment advisor will not be able to provide distribution services to clients as it has segregated the activities enlisted in advisory and distribution arena. 

An upper limit on the fees charged to the clients by investment advisers will be introduced by SEBI. An enhanced eligibility criteria for registration that will include net worth, qualification and experience requirements will be put forth as well. 

Provisions for fast-tracking rights issue of units by real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) have also been approved by the regulatory body. 

Author - Dyuti Pandya