Mumbai, May 29 (KNN) The Securities and Exchange Board of India (SEBI) has released a discussion paper on a framework for a ‘regulatory sandbox,’ wherein companies dealing with financial technology can test new technologies and products in a live market environment.

The move will give the companies an opportunity to test their solutions on real customers/investors. On the other hand, it may help SEBI to frame policies that may reduce the time and cost of deploying new investor-centric solutions in the capital market.

As per SEBI, the term 'regulatory sandbox' pertains to live, testing environment where new products, processes, services and business models can be deployed on a limited set of eligible customers for a specified period of time with certain relaxations in the extant SEBI regulations and guidelines.

“SEBI plans to introduce a framework, which will be called regulatory sandbox. Under this framework, financial institutions regulated by SEBI shall be granted certain facilities and flexibilities to experiment with fintech solutions in a live environment and on real customers. These features will be fortified with necessary safeguards for investor protection and risk mitigation,” the regulator said.