The State Bank of Pakistan (SBP) has concluded the first cohort of its Regulatory Sandbox, completing a testing programme designed to support innovation in digital financial services under controlled regulatory conditions. The initiative was launched in August 2025 in line with SBP Vision 2028, allowing innovative financial solutions to be tested under the central bank’s regulatory oversight before potential commercial introduction.
The first cohort focused on three areas of digital financial services: technology-enabled solutions for inward remittances, open banking and remote onboarding of merchants. Following an extensive scrutiny process, six participants were shortlisted to test their proposed solutions through the sandbox between January and June 2026.
During the testing period, SBP teams provided regulatory guidance and support to participating companies as they evaluated their solutions in the controlled environment. At the completion of the cohort, four participants successfully demonstrated their solutions, covering technology-enabled remittance services and open banking applications.
Taptap Send UK Limited and United Bank Limited successfully participated under the theme of technology-enabled solutions for inward remittances. Digi Khata (SMC-Private) Limited, Swich Retail Private Limited and Neem Exponential Financial Services (Pvt) Ltd successfully demonstrated solutions under the open banking theme.
SBP has clarified that successful completion of the Regulatory Sandbox testing does not constitute regulatory approval. Participants that successfully complete testing are still required to obtain the appropriate authorization and approval from SBP before commercially launching the products or services that were tested through the sandbox.
The findings and learnings generated during the first cohort are expected to contribute to the development of relevant regulatory frameworks. SBP said the regulatory recommendations emerging from the testing process will help support the broader digital financial services industry and provide a foundation for addressing innovative products and business models within the regulatory framework.
The Regulatory Sandbox is intended to give fintech companies and banks an opportunity to develop and test practical, user-centric and technology-enabled financial solutions while operating within a controlled environment. The initiative also allows the regulator to assess new approaches and understand their potential implications before products are introduced more broadly.
Going forward, SBP expects the Regulatory Sandbox to continue supporting industry participants, including fintechs and banks, in developing innovative financial services. The central bank said the initiative can help expand the outreach of financial services while improving operational efficiency and customer experience through technology-enabled solutions.
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