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Code: 52645 Visited: 59 Publish Date: Oct 28 2018 - 3:33
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IFB
Financing Fintech Firms Is Going to Be Easier with IFB’s New Proposal
Tehran, Oct. 28 (SENA) - Iran Fara Bourse proposed a model that removing the red tape of financing fintech startups in an integrated and harmonious manner is just one of its applications.

Tehran, Oct. 28 (SENA) - Iran Fara Bourse proposed a model that removing the red tape of financing fintech startups in an integrated and harmonious manner is just one of its applications.

The current procedure for presenting new financial instruments is a long one; Firstly, the new instrument must comply with Sharia so it has to be checked by the Sharia Committee that takes about a month. Then there are legal issues. The new instrument must comply with current laws and regulations and also there may be a need to enact new ones, which could take about half a year to pass. After that, SEO and Securities and Exchange High Council each need one month to approve the new financial instrument. And finally, there is implementing process, including getting required licenses and public offering, a minimum of a year procedure.

What Iran Fara Bourse proposed is to apply the Sandbox mechanism; A mechanism for developing regulation that keeps up with the fast pace of innovation.

The sandbox process is the very shorter way we’re looking for: A week for Sharia compliance, one week for Finstars (an event held by IFB in which fintech startups participate) committee to prove its concepts, one week for limited and private offering are estimated, and finally, the feedback period; If the new product is successful, it will be offered to the public (within this period, the required regulations can be legislated).

Because of the high compliance costs, time-consuming process for sharia’ compliance and regulation compliance there is a serious need for applying Sandbox in Iran too as it’s an experienced and growing matter all around the world e.g. in North America, in Europe, Asia and in Australia.

Iran Fara Bourse stock exchange (IFB) CEO at a speech at Kishinvex2018 a few days ago elaborated on the Sandbox mechanism and mentioned the three entities that play the key roles in the very process; These entities are: Iran Fara Bourse as Finstars secretariat, Rayan Bourse as technical partner of SEO, and Iran Financial Center as a financial data center.

Hamooni continued: The other part of our future sandbox is private placement of financial instruments in specific volume and restricted time. This will make a pilot issuance model for financial instruments and will help the regulatory body to design efficient regulations. With sandbox, the whole system including its consumers, could have access to reliable and real-time information, not to the data which exist about a year ago or so and all fintech (firms/startups) could have access to the data in transparent and fair manner; Granting them access the data, they have incentive to protect their consumers and their privacy.

 

Moreover, SEO CTO elaborated on the SEO’s approaches in this context and declared that the new technology has the potential to transform the financial world.

Motahareh Moravvej then addressed the importance of fintech in decreasing IT costs and mentioned the Iran capital market key players measures including launching Finstars, crowdfunding, fintech taskforce etc.

 
By: Security and Exchange News Agency (SENA)
 
 
 
 
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