BoG launches Regulatory and Innovation Sandbox after successful pilot

Following a successful pilot implementation, Bank of Ghana (BoG) on Friday launched its Regulatory and Innovation Sandbox developed in collaboration with EMTECH Solutions Inc.

This is in line with the bank’s commitment to continuously evolve a conducive regulatory environment that fosters innovation, financial inclusion and financial stability.

A statement issued by the BoG in Accra on Friday said over the past two years and during the pilot, the use of digital financial services among Ghanaians had recorded remarkable increase on account of a raft of enabling policies introduced by the Central Bank under the national digitalisation agenda.

“At the same time, the restrictions imposed on movement of persons as part of the COVID-19 containment measures have spurred the adoption of digital financial services among individuals, businesses, government ministries, departments and agencies,” the statement said.

It said “Similarly, the adoption of emerging technologies such as artificial intelligence, machine learning, and data analytic tools is accelerating among Ghanaian financial service providers with enormous opportunities for innovative products and services including chatbot, Know Your Customer (KYC) and Customer Due Diligence (CDD) solutions, anti-money laundering and fraud monitoring platforms, credit scoring for digital credit products and customer-centric product designs.”

The statement said within the domain of BoG, the digital version of the Ghanaian currency, the eCedi, had the potential of boosting innovation in digital financial service and further enhancing digitalisation of the financial service industry when mainstreamed.

“On the other end of the digitisation spectrum, blockchain appears to hold significant promise for use in mainstreaming financial service delivery though the technology is yet to mature. Nevertheless, Bank of Ghana took a bold decision and admitted a blockchain solution into its Regulatory and Innovation Sandbox during the pilot stage; a further evidence of its commitment to innovation,” it said.

Against the backdrop of these developments, the statement said the Regulatory Sandbox is an opportune tool for harnessing the potential of technology to develop an efficient and inclusive financial service industry without risking financial stability.

More importantly, it said it would serve as an enabling framework for small scale, live testing of innovations by innovators operating under a special exemption, allowance, or other limited, time-bound exception in a controlled environment under the regulator’s supervision.

“ It aims at, among others, fostering a deeper understanding of innovative products, services and business models by the regulator, allowing for potential improvements to legal and regulatory requirements to encapsulate emerging technologies, and ensuring careful monitoring and containment of any risks that may emerge,” the statement said.

BY KINGSLEY ASARE

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