Nepal Rastra Bank (NRB) has unveiled a draft framework for establishing a “Regulatory Sandbox” — a supervised environment designed to facilitate the safe testing of innovative technologies, financial products, and services. This strategic move aims to foster responsible innovation while advancing financial inclusion in Nepal.
The Regulatory Sandbox will serve as a controlled setting where banks, financial institutions, and fintech companies can trial their innovations under close oversight by the central bank. NRB has opened the draft for public feedback, reflecting its intention to involve stakeholders in shaping this regulatory initiative.
According to the draft, the sandbox will provide a platform for evidence-based testing of digital financial tools before they reach the commercial market. This is intended to improve access, usage, and the overall quality of digital financial services, while simultaneously safeguarding consumers and maintaining systemic financial stability.
A core feature of the sandbox is its focus on supporting fintech innovators, although traditional financial service providers with ready-to-test solutions can also apply. Eligible participants include banks, payment service providers, remittance firms, and other entities operating under Nepal’s existing financial laws.
NRB emphasized that the sandbox will not only enable real-world testing without compromising consumer protection, but also help bring emerging technologies within the regulatory scope. By encouraging dialogue between regulators and innovators, the framework seeks to inform future policy decisions and strengthen regulatory capacity in the face of rapid technological change.
Ultimately, this initiative aims to balance innovation with oversight, ensuring that Nepal’s financial sector evolves securely and inclusively in the digital era.
