Swich has encouraged fintech companies in Pakistan to apply for the second cohort of the State Bank of Pakistan’s (SBP) Regulatory Sandbox, following its participation in the central bank’s first cohort under the Open Banking theme. In a LinkedIn update, the company described its experience as a valuable opportunity to contribute to the development of financial innovation in Pakistan. Nisar A. Mughal, Head of Product at Swich, reflected on the company’s participation and acknowledged SBP’s support during the process. The announcement also recognised Noman Azhar, Co-Founder and Chief Officer at Zindigi, for his support and partnership throughout the journey. Swich’s message comes as SBP invites new proposals from fintechs and other eligible applicants seeking to test innovative financial products and services in a controlled regulatory environment.
SBP launched its Regulatory Sandbox in August 2025 under its Vision 2028 strategy to facilitate the testing of technology-enabled financial solutions while maintaining regulatory oversight, consumer protection and financial stability. The first cohort covered technology-enabled inward remittances, Open Banking and remote onboarding of merchants. Six applicants were initially shortlisted, with Swich Retail among the participants selected to test a solution under Open Banking. The testing period ran from January to June 2026, during which participants received regulatory guidance and support from SBP teams. In September, the central bank announced that Swich, Digi Khata and Neem Exponential Financial Services had successfully demonstrated their Open Banking solutions, while Taptap Send UK and United Bank Limited demonstrated a technology-enabled inward remittance solution. The findings from the first cohort are expected to inform the development of relevant regulatory frameworks for the wider financial services industry.
Open Banking can enable financial information and services to be shared between authorised institutions and third-party providers through controlled, permission-based mechanisms. Depending on the solution and applicable rules, these arrangements can support services that connect financial accounts, improve access to financial information and help providers develop more integrated digital experiences. For fintech companies, testing under a regulatory sandbox can offer an opportunity to assess a proposed service in a supervised setting, understand regulatory expectations and identify operational or compliance issues before pursuing a commercial launch. However, successful completion of sandbox testing does not itself constitute regulatory approval. SBP has clarified that participants must obtain the necessary authorisation before commercially launching the products or services they tested. Swich’s participation should therefore be understood as a completed testing milestone, not confirmation that every element of its solution is authorised for unrestricted commercial deployment.
The second cohort is open to proposals covering four areas: artificial intelligence in financial services, innovations in payments, technology-enabled inward remittances, and an open theme focused on next-generation financial services. SBP has set November 30, 2026, as the application deadline and said that only proposals falling within the specified themes will be considered. Interested firms and individuals can review the requirements and application procedure through the official SBP Regulatory Sandbox page. Swich’s recommendation to other fintechs highlights the potential value of engaging with regulators during the development of new financial products. For applicants, the process offers an opportunity to test ideas and receive regulatory guidance, although participation will depend on eligibility, the proposed use case and SBP’s assessment. The second cohort will continue the central bank’s effort to encourage financial innovation while developing a regulatory environment suited to emerging technologies and changing customer needs.
Follow the SPIN IDG WhatsApp Channel for updates across the Smart Pakistan Insights Network covering all of Pakistan’s technology ecosystem.
