Utah recently launched a regulatory sandbox that will enable fintech startups to test new products and services without getting a license.
The Department of Commerce anticipates that this service will provide Fintech startups and entrepreneurs with a platform where they can easily launch their businesses. The department said that it will be responsible for applications in the sandbox and will also provide administrative oversight of it.
This regulatory sandbox is meant to help entrepreneurs take their products and services to the market without going through the regulatory channels and licensing requirements. Apart from that, the sandbox is like a laboratory where entrepreneurs can test their innovative ideas before taking them to the market.
In the press release, the Representative Marc Roberts (R-Provo) said:
“I’m excited about Utah’s Regulatory Sandbox and the chance it will give fintech companies and entrepreneurs in Utah the chance to take innovative products and ideas to market without having to jump through the traditional regulatory hoops and licensing requirements…this is good for Utah and the future of Fintech innovation.”
With the waiver in place, the state seeks to encourage new businesses to emerge. Companies in Utah that may benefit from the launch could include those that deal with innovative financial products and services- money lending companies, blockchain based companies and cryptocurrency firms.
Utah is the second state, after Arizona, to launch a regulatory sandbox. The state is also looking forward to starting more innovative programs in support of the financial technology industry. The launch of this regulatory sandbox is expected to maintain the state’s status as the Best state for business as ranked by Forbes.
Many countries, including Singapore, the U.K., and the United Arab Emirates are supporting fintech investments by adopting sandboxes. Since Arizona launched its sandbox in 2018, it has attracted many companies interested in testing innovative fintech products or services.
Utah and Arizona have almost similar laws regulating these fintech programs. However, Utah included blockchain in the types of innovations that the program may run while Arizona’s laws have not specifically mentioned blockchain technology.
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