World's first cross-border, open-architecture platform to improve financial inclusion

26 September 2018

Regulatory sandboxes have gained a phenomenal amount of traction in recent years as a dynamic staging ground fintechs can use to collaborate with government agencies and develop new technologies they wish to bring to market. From the Monetary Authority of Singapore and the Bank of Thailand, to the Reserve Bank of India and even the US State of Arizona, there has been a flurry of interest in the evolution and advancement of regulatory sandboxes and their role in the fintech landscape.

Yet until this year, that advancement has been stifled by national borders and the insurmountable hurdles that go hand-in-hand with various pieces of divergent financial legislation across key jurisdictions. It goes without saying fintech start-ups taking part in sandbox cohorts have inherently experienced consequent barriers when trying to scale and enter new overseas markets.

That all started to change in August, when the UK’s Financial Conduct Authority (FCA) announced a new partnership with 11 other financial regulators to create the world’s first global sandbox. Yet while the FCA’s so-called Global Financial Innovation Network sandbox is still undergoing a series of extensive consultations, the ASEAN Financial Innovation Network (AFIN) has announced plans to kickstart its own international sandbox of a different variety – although its goals do align with those of the FCA.

AFIN’s new API Exchange (APIX) project is designed to be a flexible online global fintech marketplace and sandbox platform for financial institutions of all shapes and sizes, and is already being touted as the world’s first cross-border open architecture platform for fintechs.

AFIN, which was formed in 2017 as a collaboration between the Monetary Authority of Singapore, the International Finance Corporation and the ASEAN Bankers Association, claims the new exchange will enable financial institutions and fintechs to better connect with one another, experiment together and adopt new APIs that can drive digital transformations and improve financial inclusion across Asia and the Pacific.

APIX is set to be unveiled at the Singapore FinTech Festival in November, and is being designed and operated by a consortium led by Virtusa, Fidor and Percipient – which organisers say will bring openness and inclusion to the ASEAN sandbox project.

That’s because Fidor’s community-based digital banking platform will influence the development of APIX and act as an acquisition and engagement tool to increase levels of interactions between large incumbents and smaller fintechs looking to collaborate. Meanwhile, Percipient’s emphasis on open data and system integration should help to establish and instil APIX’s desired culture of transparency and partnership.

The consortium is being powered by Hewlett Packard Enterprise, will enjoy access to the Ping An Group’s 2,000 banking APIs and will subsequently bear responsibility for applying proven tech solutions to support the transition of regional financial institutions towards more dynamic methods of API architecture and assist them in collaborating with other market participants using the online platform.

While the APIX platform is being developed specifically with the financial marketplaces across the ASEAN region in mind, AFIN also announced last week it had struck a partnership with Abu Dhabi Global Market that will see the UAE financial centre appointed the first non-ASEAN regulatory member. In turn, the reach of APIX and its global fintech sandbox will soon stretch beyond Asia in order to offer access to its sandbox and marketplace across the Middle East and North Africa.

By inputting its own standards into APIX, the Abu Dhabi Global Market’s Financial Services Regulatory Authority will be able to supervise users in real-time and offer market participants across the region an open but controlled environment with which to test, experiment and collaborate with a range of ASEAN financial institutions and fintechs across the globe.

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development