The Capital Markets Authority of Kenya (CMA) and the Australian Securities and Investments Commission (ASIC) have signed a Co-operation Agreement which aims to promote innovation in financial services in their respective markets.
The agreement was signed in the margins of the Board meeting of the International Organization of Securities Commissions (IOSCO) held in Hong Kong last week.
The agreement sets up a framework for co-operation between the CMA and ASIC in the expanding space of innovation in financial services. The parties have agreed to share information in their respective markets including on emerging market trends and regulatory issues arising from the growth in innovation.
Paul Muthaura, Chief Executive, CMA, said: ‘We are committed to facilitating innovation in financial services, leveraging Kenya’s positioning in the region as an innovation centre. This however calls for us to assess lessons learned and to compare strategies to balance innovation and regulation with our peer regulators.’
‘The CMA has recently commenced efforts towards the establishment of a Regulatory Sandbox structure that is designed to encourage innovation in the capital markets. This strategy reflects the CMA’s role in facilitating the introduction of new fintech products in the capital markets area.’
‘ASIC has developed an Innovation Hub and we are keen to share best practices in terms of how to address regulatory issues pertaining to innovation in financial services.’
Greg Medcraft, Chairman, ASIC, said: ‘We are excited to be working more closely with CMA. It operates in a jurisdiction that has seen significant fintech innovation growth. Innovation in financial services isn’t confined by national borders. We hope this agreement will help to break down barriers to entry both here and in Kenya.
‘Since ASIC launched its Innovation Hub in 2015, we have seen a surge in requests by fintech start-ups seeking assistance about how to navigate the regulatory requirements.
‘Most recently we have consulted on the establishment of a Regulatory Sandbox that proposes an environment to allow start-ups to test concepts without a licence – we are currently considering the results of that consultation.