Ahmad Ali Al Sayegh, Minister of State and chairman of the ADGM
Ahmad Ali Al Sayegh, Minister of State and chairman of the ADGM. Image Credit: Gulf News Archives

Abu Dhabi: In an effort to ease the way fintech start-ups communicate with banks on their services and products, Abu Dhabi Global Market (ADGM) on Tuesday unveiled its digital sandbox, which will connect all three parties digitally and in real time.

“Today, we are opening the ADGM digital sandbox, a cloud based environment for fintechs, banks and others to co-create and test products with regulators to deliver better services to clients,” said Ahmad Ali Al Sayegh, Minister of State, chairman of ADGM, speaking at FinTech Abu Dhabi.

“This state-of-the-art platform will replace the current regular programme which has been running for three years, as we move from analogue to digital,” he added.

Al Sayegh said that banks involved with the initiative included First Abu Dhabi Bank, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank and Anglo Gulf Trade Bank.

“We learned that to stay globally relevant we need to listen and learn from the industry as regulators … to enable this industry to flourish,” he added, highlighting the importance of new and innovative solutions in digital banking services.

For his part, Wai Lum Kwok, senior executive director, Capital Markets Financial Services Regulatory Authority, ADGM, said the digital sandbox would be open to both local and international fintech start-ups, calling the previous model ineffective.

“We have invited potential fintech start-ups to come and test their solutions with us and for us to supervise and grant them license to do, which will enable them to test their solutions with the wider market.

“With the digital sandbox we are able to connect the start-ups with the banks and financial institutions, and with that comes a true digital environment and connectivity,” he added.

“As the regulator we will be able to see and monitor in real time what they are offering, making the collaboration much more effective,” he said, explaining the benefits.

Kwok also said it was important for ADGM as a regulator to be on top of the latest technological developments being made in the fintech sector, better helping them with regulatory measures.

“As a regulator we cannot be in a situation where we don’t know what is happening. Being able to log into the digital sandbox and understanding the latest developments in the sector allows us to update our rules and regulations based on the insights we obtain.

“Being able to plug in and monitor in real time what is happening is a very important part of our development, and will assist us in our regime on digital banking, digital securities and crypto currency frameworks,” he added.

Daniel Gould, deputy Chief Executive Officer, Anglo Gulf Trade Bank, said the digital sandbox was much needed for banks and would help to speed up the process of incorporating fintech services with their banks.

“We see this as a great opportunity to work with the regulator in test driving fintech companies to really help them to better develop their products, and for us as a bank to better understand the value proposition from the fintech company.

“Should we decide to go ahead with the fintech company it will allow us to integrate their services in our operating model in a faster way as well,” he added.

“The digital sandbox is a very safe and visible environment that shows all participants about what’s going on, the products and type of services that are being offered and what works for us,” he said.