The Central Bank of Nigeria (CBN) has issued an exposure draft of the regulatory framework for the operation of Sandbox in the country.
A sandbox is said to be a type of software testing environment that enables the isolated execution of software or programs for independent evaluation, monitoring or testing. (Techopedia).
In a circular jointly signed by Musa Jimoh, director, payment system management department, and Kevin Amugo, director, financial policy and regulation department, the framework details the requirements for conduct of live tests on innovative products, services and other solutions in a controlled environment.
The Apex bank said it is committed to building a financial services sector that promotes innovation in financial services, effective effective service delivery, healthy competition and financial inclusion.
In this regard, the circular said the CBN has implemented several reform initiatives towards the achievement of these objectives.
The Sandbox application process is open to both existing CBN licensees (financial institutions with FinTech initiatives) and other local companies. The later may include financial sector companies as well as technology and telecom companies intending to test an innovative payments product or service industry deemed acceptable by the CBN.
Others that can also apply include: those proposing non-regulated technology i.e. Innovators whose proposed solution involves technologies which are currently not covered under existing CBN regulations.
A Letter of Approval (LoA) would be issued to the Innovator which would allow Sandbox participants to test their innovation upon entry into the sandbox.