Regulatory sandbox
A regulator's framework for testing new financial products with real customers, under agreed conditions and close supervision.
A regulatory sandbox lets firms test innovative financial products or services with real customers under conditions agreed with the regulator, in some schemes with certain requirements relaxed, subject to safeguards and supervision. Bank Negara Malaysia's sandbox, for example, offers a standard track for fintech companies and a faster green lane for financial institutions with strong risk management records. Other schemes, such as the UK Financial Conduct Authority's, do not exempt firms from authorisation but give access to regulatory expertise.
Sources
This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.