Proposed legislation focusing on innovation in Alberta’s finance sector

Travis Toews, President of the Treasury Board and Alberta’s Minister of Finance said, “the world of finance is rapidly evolving, and our government understands that we need to partner with businesses if Alberta is going to stay ahead of the curve.”

“Cutting red tape and making it easier to do business in Alberta is a crucial part of our strategy to grow the economy, support job creation and make Alberta the best place to live, work and raise a family.”

The province explained that generally, before companies can start to begin offering new products and services to the public, they have to devote a significant amount of resources to meeting regulatory requirements. When the new product or service hits the market, there is still a risk that it won’t work as they intended or that it won’t be popular enough to continue supporting.

The government noted that the sandbox would help mitigate this kind of risk and encourage companies to be more innovative.

Dr. Ryan Clements, assistant professor, chair, Business Law and Regulation at the University of Calgary said, “a provincial regulatory sandbox, focusing on the finance and financial technology sector, is a very positive development that will help to support innovation, competition and job formation, while ensuring appropriate consumer protection measures and regulatory safeguards.”

“The supervised environment lowers barriers to entry for new firms while creating controlled parameters to test consumer applications that could increase choice and lower the costs of financial products and services. It also facilitates efficiency, coordination, and information sharing across regulatory agencies.”

The provincial government would work with participating companies to make sure they take the appropriate precautions and provide safe and sound products and services to consumers.

If the bill is passed, the government’s goal is to start accepting sandbox applications by July 1.


If the Act passes, each company taking part in the sandbox will have to meet the following criteria, as outlined by the province:

  • Physical presence requirement – Applicants would be required to maintain a physical presence in Alberta. For example, they will need to have an office in Alberta or staff living in Alberta.
  • Financial services requirement – The sandbox would only be for companies that offer financial products or services.
  • Innovation requirement – Applicants would have to adequately explain why each eligible product or service should be considered new and original, or at least how it is a new adaptation or material improvement of another product or service. Applicants would not receive exemptions for products or services that are already offered in Alberta by other companies.
  • Business plan requirement – Applicants must provide a sound and viable business plan, including details for testing their financial product or service and plans to exit the regulatory sandbox.

Participating companies would have up to two years in the sandbox to test their products, with the possibility to extend the period for one further year.

Companies taking part may also have to abide by additional terms, conditions and restrictions, which the province would determine on a case-by-case basis.

For example, participating companies may be required to:

  • Consult a qualified expert or auditor.
  • Limit the number of customers who can purchase the product or service being tested.
  • Have a certain amount of cash or liquid capital to support the venture.
  • Provide proof of appropriate insurance coverage.
  • Implement specific financial security or surety requirements to mitigate risk and losses.
  • Implement risk management policies and procedures.
  • Maintain a consumer complaint mechanism to allow consumers to resolve concerns.


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