The Regulatory Sandbox, which was introduced in August 2022, is a mechanism designed to take advantage of technology’s potential to create a competitive and equitable financial services sector without jeopardizing financial stability.
More crucially, it is anticipated to act as a regulatory oversight framework for innovators operating under a special exemption, permission, or other restricted, time-bound exception to allow for small-scale, live testing of ideas in a controlled setting.
It aims to, among other things, encourage the regulator’s understanding of cutting-edge goods, services, and business models, enables potential improvements to legal and regulatory requirements to incorporate emerging technologies, and ensure careful monitoring and containment of any risks that may emerge.
All licensed financial institutions (Banks, Specialized Deposit-taking Institutions, Payment Service Providers, Dedicated Electronic Money Issuers, Financial Holding companies, and other Non-Bank Financial Institutions), as well as unlicensed FinTech start-ups that have novel goods, services, or business models that meet the Regulatory Sandbox requirements, are welcome to participate in the Regulatory Sandbox.
The Sandbox will now be open from February 13–March 14, 2023, according to a press statement from the central bank, to accept the first cohort of participants.
The first cohort window would primarily accept innovations in priority fields including payments, remittances, crowdfunding, and microlending, it was claimed.
After the application window closed on March 14, 2023, it said that prospective participants would be notified of the results of their applications in twenty-one (21) working days.
