The Central Bank of the UAE (CBUAE) has issued the Sandbox Conditions Regulation, which aims to attract start-ups and global fintech businesses and create an attractive environment for the financial sector that supports creativity and innovation within a regulatory and supervisory framework. It will also consolidate the financial sector’s competitiveness and support the UAE’s economic growth.
The Central Bank of the UAE (CBUAE) has introduced the Sandbox Conditions Regulation to foster innovation in the financial services sector. This regulation is designed to attract start-ups and global fintech companies, creating a conducive environment that promotes creativity and innovation while maintaining a robust regulatory and supervisory framework. The initiative aims to enhance the financial sector’s competitiveness and contribute to the UAE’s economic growth.
The regulation sets forth specific conditions for participants, including start-ups, fintech, and established businesses seeking to deliver innovative solutions and services within the financial services sector. It provides criteria for exemptions from obtaining a license, allowing participants to test new business models, products, and services within a defined period. Participants must continually comply with regulatory obligations to ensure positive outcomes for all stakeholders.
These conditions enable the CBUAE to effectively assess and respond to innovations as part of its supervisory activities. They also help participants understand how to structure their businesses in a manner compliant with regulations.
Applicants must present a technologically innovative financial product, service, solution, or business model that could benefit consumers or the wider industry. Additionally, participants need to demonstrate their intention to deploy the proposed service on a broader scale in the UAE after exiting the Regulatory Sandbox.
Khaled Mohamed Balama, Governor of the CBUAE, stated, “The issuance of the Sandbox Conditions Regulation is a testament to the UAE’s keenness towards enabling innovation and building a knowledge-based national economy. By providing a structured platform for experimentation, we are encouraging innovators to contribute positively to the wider economy and participate actively in the Sandbox Conditions Regulation, while ensuring consumer protection and achieving the interests of all stakeholders.”
The regulation has been published in the Official Gazette and is now in effect.
