Regulatory Sandbox
reg-yoo-LAH-tor-ee SAND-boks
/ˌrɛɡ.jʊˈleɪ.tər.i ˈsænd.bɒks/Listen
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Syllable breakdown
Dictionary meaning
A controlled framework set up by regulators (e.g., FCA in the UK, MAS in Singapore) that allows fintech companies to test innovative products, services, and business models in a live environment with real customers, under relaxed regulatory requirements and supervision.
Examples
- The startup used the FCA's regulatory sandbox to test its AI-powered credit scoring without a full banking license.
- Regulatory sandboxes have been adopted by over 50 countries to foster fintech innovation.
Originated in the UK (FCA, 2016). Now a global concept. Sometimes called 'innovation hub' in US regulatory contexts.
Synonyms: fintech sandbox, innovation sandbox, controlled testing environment, regulatory lab
Pronunciation tips
The 'sandbox' metaphor: like children playing in a sandbox with defined boundaries, fintechs can experiment without the usual regulatory penalties.
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