The State Bank of Pakistan (SBP) is inviting applications for the second cohort of its Regulatory Sandbox, with submissions open until November 30, 2026. The programme is designed to give eligible businesses and innovators an opportunity to test new financial products, services, technologies and business models in a controlled environment under regulatory oversight. The latest cohort includes a dedicated theme for innovations in payments, with a focus on exploring secure and reliable payment methods, addressing emerging payment needs, and supporting offline and embedded payments. The initiative is part of SBP’s broader efforts under Vision 2028 to encourage responsible innovation across Pakistan’s digital financial services ecosystem while maintaining consumer protection and financial stability. Through the sandbox, the central bank can observe how new solutions perform in practice and use the findings to inform the development of regulatory approaches as financial technologies evolve.
The payments theme is relevant to fintech companies, financial institutions and technology providers developing alternatives to conventional payment methods. Offline payments may help address situations where continuous internet connectivity is unavailable, while embedded payments allow transactions to take place within other digital services, platforms or customer journeys. Secure payment solutions may also improve convenience for consumers and businesses while addressing risks involving fraud, authentication and transaction processing. SBP has not restricted the second cohort to payment innovations alone. The other areas include artificial intelligence in financial services, technology-enabled inward remittances and an open theme covering next-generation financial services. Applicants must ensure that their proposed solutions fall within the scope of the announced themes. The programme is intended for proposals that demonstrate genuine innovation and have a clear testing proposition, rather than ideas that simply reproduce existing services without a distinct improvement or new application.
The Regulatory Sandbox is open to several types of applicants, subject to SBP’s eligibility requirements. These include institutions regulated by the central bank, entities licensed by other regulators, local startups and individual applicants with innovative fintech solutions, as well as eligible foreign entities. Depending on their circumstances, applicants may apply directly or partner with an SBP-regulated institution. The central bank provides participants with a controlled testing environment, regulatory guidance and opportunities to engage with relevant experts. This can help innovators better understand applicable legal and compliance requirements while allowing the regulator to assess potential risks before a product or service is introduced more widely. Participation does not automatically mean that a solution will receive permission for unrestricted commercial launch. Applicants must follow the programme’s conditions and obtain any additional approvals required under the applicable regulatory framework. The sandbox also does not function as a funding programme for startups; its principal purpose is supervised testing and regulatory learning.
Interested businesses and innovators must submit their applications by November 30, 2026, following the instructions in the official SBP Regulatory Sandbox guidelines. The application form, eligibility details and step-by-step procedure are available through the SBP Regulatory Sandbox website. Applicants can also contact the programme team at regulatory.sandbox@sbp.org.pk for relevant queries. The first cohort concluded in June 2026 after selected participants tested solutions in areas including open banking and technology-enabled inward remittances. Lessons from that process can help inform the next phase of experimentation in Pakistan’s financial services sector. For payment innovators, the second cohort offers a formal route to test ideas under regulatory supervision, assess operational challenges and gather evidence that may inform future product development. The eventual impact will depend on the quality of proposals, testing outcomes and the regulatory steps required before solutions can reach the wider market.
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