Held in November 2016, RegHackTO brought together more than 120 members of the Canadian fintech community who competed to find solutions to regulatory problems in four areas:
- Know-Your-Client (KYC)/identity authentication,
- financial literacy and
- transparency in the capital markets.
There is great potential for fintech to address real regulatory challenges, and RegHackTO gave us an unprecedented opportunity to witness this firsthand,” said Maureen Jensen, Chair and CEO of the OSC. “But to support novel products, services and applications of benefit to investors, our regulatory approach needs to evolve. We must be open to new and sometimes uncharted ways of doing business.
Several themes emerged from RegHackTO. The hackathon made it clear that distributed ledger technology is powerful and has the potential to increase efficiencies and transparency in capital markets. Additionally, the event highlighted how open access to data is essential for advancing fintech solutions, particularly with regards to simplifying the collection of KYC information. Lastly, the hackathon reconfirmed that regulators must be prepared to consider novel fintech ideas and business models in a flexible manner.
Based on these results, the OSC will explore ways to take a more innovative and flexible approach to regulation. Next steps include
- considering opportunities to leverage technologies such as artificial intelligence in the OSC’s regulatory work;
- supporting the facilitation of access to data where it fairly increases competition and provides tangible benefits to investors; and
- encouraging participants in the fintech community to build and speak to OSC staff about test pilots for centralized KYC information collection and verification processes.
The OSC also intends to continue to support emerging fintech businesses and digital innovation through its OSC LaunchPad initiative, as well as collaborate with regulators around the world to monitor and support fintech development.