On being granted the FSP to carry on the Regulated Activity of Developing Financial Technology Services within the RegLab, the Regulator may impose limitations or conditions on the FinTech Participant in accordance with sections 30(4) and 35 of the FSMR. These may include, but are not limited to, any of the following:
(a) the number and type of Clients with or for whom the FinTech Participant carries on, or intends to carry on the Regulated Activity of Developing Financial Technology Services within the RegLab;
(b) the type and size of Client transactions that the FinTech Participant is permitted to enter into;
(c) the suitability assessment and Clients' written consent required prior to carrying on the Regulated Activity of Developing Financial Technology Services within the RegLab;
(d) the FinTech Participant's ability (if any) to hold or control Client Money and Client Investments;
(e) the requirements surrounding the FinTech Participant's handling and protection of Client information;
(f) the manner and type of financial promotion that the FinTech Participant may undertake and the associated disclosures that the FinTech Participant is required to make to Clients1;
(g) the key information required to be contained in a Client Agreement;
(h) the prevention of money laundering and countering the financing of terrorism measures that the FinTech Participant is required to implement2;
(i) the FinTech Participant's capital requirements (if any)3;
(j) the FinTech Participant's financial and other reporting requirements;
(k) any other safeguards to protect the interests of Clients or maintain the safety and soundness of the financial system as the Regulator may prescribe.
1Requiring appropriate disclosures to, and consent of clients willing to use the FinTech product in order for clients to make an informed decision.
2If the Regulator has greater concerns regarding a FinTech solution, it may require the FinTech Participant to appoint an established financial institutions as a sponsor to undertake responsibility for compliance assurance or resolution of any client issue if a test does not perform as expected — e.g. the trial deployment of a robo-advisor may be excluded from Anti Money Laundering/Know Your Client due diligence if the consumer opens an investment account with a sponsor bank, which takes on the corresponding regulatory obligations.
3For example, reducing or waiving capital requirements where the Regulator deems appropriate.