CT HB05489

Establishes a regulatory sandbox program within the Department of Economic and Community Development, effective October 1, 2020, allowing persons to temporarily test innovative financial products or services for 24 months without obtaining a state license or authorization.

Applicants must submit applications demonstrating necessary personnel, financial and technical expertise, a detailed testing plan, cybersecurity measures, and consumer protection strategies; the Commissioner must receive approval from all applicable state agencies before granting admission.

Sandbox participants must restrict consumers to state residents, comply with department-specified caps on consumer numbers and transaction amounts, disclose to consumers that the product is undergoing testing and carries financial risk, and must be deemed to possess appropriate licenses for federal law purposes.

Participants must maintain records and business data, report if products fail, cease operations within 60 days of the 24-month testing period unless seeking an extension, and continue fulfilling ongoing duties such as loan servicing after exit.

The Commissioner may remove participants for violations of the sandbox program or state/federal criminal law, and must submit annual reports to the General Assembly starting January 1, 2021, detailing applicant numbers, participants, and tested innovations.