BCB Issues Guides for Open Banking and Regulatory Sandbox Operations
BCB and the National Monetary Council (CMN) published resolutions to establish guidelines for the operation of controlled test environments for technological innovations in the financial sector (regulatory sandbox). The resolutions also provide for the conditions for the supply of products and services tested under this environment's framework, within the scope of the National Financial System (SFN) and the Brazilian Payment System (SPB). The resolutions entered into force on December 01, 2020. BCB also published a resolution, which takes effect from its publication date, that establishes technical requirements and operational procedures for the implementation of open banking in Brazil.
The Regulatory Sandbox is an environment where entities are licensed by BCB to test, for a certain period, an innovative project in the financial or payment areas, observing a specific set of regulatory provisions. The implementation of the Regulatory Sandbox is intended to promote the entry of innovative business models, competition, and financial inclusion as well as to enhance the supervision process of BCB. To be licensed to operate within the Regulatory Sandbox environment of BCB, the institutions—in addition to carrying out their transactions with integrity, reliability, security, and confidentiality—must comply with the regulation on the prevention of money laundering and combat of the financing of terrorism and the handling of complaints of their clients and users. Moreover, the institution licensed to test a product/service has to disclose, to its customers, that its products and services are being offered within the scope of the Regulatory Sandbox. The Regulatory Sandbox will be implemented through cycles, whose duration will be determined by BCB and limited to the period of one year, with the possibility of one extension for the same period. The first cycle is scheduled for 2021.
Related Links
- Press Release on Regulatory Sandbox
- BCB Resolution on Regulatory Sandbox (PDF)
- CMN Resolution on Regulatory Sandbox (PDF)
- BCB Resolution on Open Banking (in Portuguese)
Effective Date: December 01, 2020 (Regulatory Sandbox Resolution)/Publication Date (Open Banking Resolution)
Keywords: Americas, Brazil, Banking, Regulatory Sandbox, Open Banking, AML/CFT, Regtech, CMN, BCB
Related Articles
HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
EBA Guide to Monitor Threshold for Intermediate Parent Undertakings
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
PRA Finalizes Approach to Supervision of International Banks
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
FCA Issues PS21/9 on Implementation of Investment Firms Regime
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
EBA Proposes Regulatory Standards to Identify Shadow Banking Entities
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
IOSCO Proposes Recommendations on ESG Ratings and Data Providers
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
ESMA Group Issues Recommendations on RFR Switch in Interdealer Market
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
ECB Study Assesses Impact of Basel III Finalization Package
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
PRA Updates Remuneration Policy Statement Templates and Tables
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.
