Robo-advisory firm Sarwa has become the first participant to graduate from the Dubai Financial Services Authority‘s regulatory sandbox following nearly 12 months of testing.Having been granted an Innovation Testing Licence from the regulator, Sarwa offers robo advisory solutions to “make investing easier, secure and more affordable by offering customers simpler way to invest their earnings for long-term financial growth.”
The DFSA, Dubai’s financial watchdog, observed the firm fine-tune its automated business during the testing period, while simultaneously developing its internal capabilities. The regulator provided frequent feedback, as well as monitoring, and ongoing engagement to assess Sarwa’s underlying operating model in a safe and controlled environment.
Bryan Stirewalt, Chief Executive of the DFSA, said:
“When we first introduced the ITL programme our goal was to offer firms the flexibility to test their new business models and solutions, so they can develop innovative products and services to tackle the growing needs of the region’s financial services industry. Sarwa’s progress is the first tangible demonstration that this goal can be achieved. We look forward to more firms following suit.”
Sarwa was the first fintech startup to enter the regulatory sandbox program, but the regulator has encouraged firms with innovative ideas to apply for the 2018 winter cohort, which is currently accepting applications through the DFSA website. The list of accepted firms will be finalized on 16 December, after which they may submit an ITL application by 17 January 2019.
The robo advisory firm promises low, honest pricing for everyone, with no hidden fees nor trading fees, no lock-in periods and no mandatory monthly contributions. The solutions offers free portfolio monitoring and rebalancing, a low fee investment service with free access to expert investment advisors.
Its risk-averse portfolio allocates 27 percent of the investment on US stocks, 25 percent on US bonds, other 25 percent of global bonds, followed by 14 percent on developed markets 5 percent on real estate, and 4 percent on emerging markets. The average risk portfolio sees an increase of allocation on US stocks to 35 percent and 26 percent on developed markets. Risk tolerant focuses almost exclusively on US stocks and developed markets, with an additional 12 percent on emerging markets, 5 percent on real estate, and 3 percent on US bonds and global bonds.
