New sandbox for fintechs to play in

A regulatory sandbox is a concept which allows firms to test innovative products, services or business models.  An initial pilot phase will run from January to July 2025, with a decision on the need for a permanent FMA regulatory sandbox to be made later in the year.

This pilot will be open to all parts of the financial sector that come under the FMA remit and can include both new entrants and those firms already with a market presence. 

Sandboxes can help spur innovation by allowing both startups and established licensed financial institutions to test new products and services in a controlled environment, the FMA says.

Firms can test their systems in a monitored space, allowing them to obtain a deeper understanding of supervisory expectations. The opportunity to adjust a product or service before full commercial launch may help reduce costs for firms.