CMA admits fintech on its live-testing platform
Steve Umidha @UmidhaSteve
Capital Markets Authority (CMA) has admitted FourFront Management Limited to the Regulatory Sandbox, bringing the total number of firms admitted to the live-testing environment for capital markets innovations to seven.
The fintech firm which is a wholly owned subsidiary of Standard Investment Bank (SIB), a licensed investment bank, enters the mix to deepen innovation.
“The admission of FourFront Management Limited to the Regulatory Sandbox will build our capacity as a regulator, to respond to the impact and support implementation of new technologies in the capital markets value chain.’
Investment technology is one of the core ways financial technology is likely to disrupt Kenya’s capital markets,” said the authority’s Acting Chief executive Wyckliffe Shamiah in a statement.
In compliance with the CMA Regulatory Sandbox Policy Guidance Note 2019, FourFront will be required to provide periodic reports to the Authority on the implementation of its test plans, achievement of test objectives, risks and challenges observed during the testing period and a final report prior to the expiry of its testing period.
FourFront Management Limited proposes to test a robo-advisory solution targeting 100 investors during a four-month period.
A robo-advisor is a digital platform that provides automated, algorithm-driven financial planning and investing services with little to no human interaction.
Typically, a robo-advisor collects information from its clientele about their financial situation and future goals through online survey and then leverages the data as a basis to offer investment advice and automatically invest client assets.
A key interest for CMA in leveraging technology to drive the capital markets value chain is the implementation of robo-advice technology.