Recently, the Bank of Ghana (BOG) released an innovation and regulatory sandbox. This is proof of the bank’s dedication to developing regulations that promote financial stability, financial inclusion, and innovation.
According to a statement by the BOG, not all innovations are eligible to be added to the sandbox. Only innovations such as digital financial technologies such as crypto, which are “immature” or “new,” are eligible.
Fostering Financial Inclusion And Innovation
The BOG highlighted that the latest innovation and regulatory sandbox are proof of its dedication to fostering technological development. The institution also acknowledged the potential of new technologies like cryptocurrency.
The financial institution believes the sandbox would help it to understand new financial products. It would also guide it on how to structure regulations that would encapsulate these technologies.
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The central bank had developed the sandbox in partnership with Emtech Solutions. This sandbox would be available to all regulated financial firms in the country.
Also, unlicensed or unregulated fintech firms whose financial products meet the requirements of the regulations are eligible to operate in the country.
Additionally, the bank noted that only new digital financial services and technologies are part of the innovations. Meanwhile, certain digital financial products do not qualify for the sandbox.
This includes digital financial products that do not attempt to solve the issue of financial inclusion. It also includes those that would disrupt the country’s financial system.
BOG Talks About CBDC Project
Furthermore, the central bank noted that creating a sandbox was important. This is because it would allow the bank to allow innovative technologies to grow while enforcing regulations to protect users.
Also, the central bank wants to be a major force facilitating the country’s cash-lite and digitization agenda.
“We will involve a range of stakeholders, including business organizations, innovation hubs and associations with the assistance of FSD Africa,” the bank stated.
Furthermore, the central bank also talked about the likelihood of a central bank digital currency (CBDC). The BOG said a CBDC project has the potential to increase innovation and financial inclusion in the county’s financial sector.
When the e-Cedi is released, the bank said it would help to push the country towards the digital economy. Meanwhile, countries like Nigeria have also launched their CBDC, although usage is very low.
While discussing blockchain tech, Ghana’s central bank mentioned that it is committed to adopting innovative technologies. As a result, it adopted a blockchain solution in the pilot phase of its sandbox project.