The State Bank of Pakistan (SBP) has officially opened applications for the first cohort of its Regulatory Sandbox, a major step under Vision 2028 aimed at accelerating digital financial innovation in the country. The initiative is designed to provide fintech startups, technology firms, and financial institutions with a controlled environment where they can test disruptive products and services without the immediate constraints of full-scale regulation.
According to the central bank, the inaugural phase of the sandbox will center on three key themes: technology-enabled solutions for inward remittances, open banking, and remote merchant onboarding. These priority areas have been identified as critical for expanding financial inclusion, streamlining banking operations, and aligning Pakistan’s financial sector with global digital trends.
The sandbox will allow innovators to experiment with novel ideas while maintaining oversight to ensure consumer protection and financial stability. SBP noted that this controlled testing environment will also provide valuable insights for refining regulatory frameworks as emerging technologies reshape financial services. By encouraging such innovation, the central bank hopes to strike a balance between the adoption of cutting-edge digital solutions and the preservation of a secure financial system.
One of the major focuses of this program is inward remittances, which remain a lifeline for Pakistan’s economy. With billions of dollars flowing into the country annually, technology-driven solutions could make cross-border transactions faster, more cost-effective, and more transparent. Similarly, open banking has the potential to transform the way financial institutions interact with customers and third-party service providers, creating new opportunities for data-driven products. Remote onboarding of merchants, another key theme, is expected to help small and medium enterprises integrate more easily into the digital payment ecosystem, thereby strengthening Pakistan’s e-commerce and retail sectors.
SBP has encouraged fintech startups, established technology firms, and financial institutions to participate in this initiative. The bank emphasized that the Regulatory Sandbox will not only nurture the local fintech ecosystem but also accelerate Pakistan’s shift toward a more inclusive and efficient digital economy. For participants, the opportunity provides a platform to validate their solutions in a real-world yet controlled setting, while also gaining early engagement with the regulator.
Applications for the first cohort will be accepted from August 25 to October 5, 2025. Interested firms can apply via a dedicated email channel set up by SBP. To assist applicants, the central bank has also published detailed Regulatory Sandbox Guidelines, which are available on its official website. These guidelines outline eligibility criteria, application procedures, and the operational framework of the sandbox.
Industry experts view this initiative as a strategic step forward for Pakistan’s financial sector, particularly at a time when digital adoption is accelerating worldwide. By opening the door for experimentation in critical areas like payments, banking, and merchant integration, SBP aims to foster an ecosystem where innovation can thrive responsibly.
As global financial systems evolve rapidly, Pakistan’s regulatory sandbox represents a timely opportunity for innovators to shape the future of digital finance in the country. The initiative is expected to set the stage for new products and services that could redefine the way individuals and businesses interact with financial institutions in the years to come.