The CBB recently issued the Regulatory Sandbox Framework directive, which includes the eligibility criteria, filing requirements and timeline for the process.
In order to be eligible, solutions need to demonstrate innovation, customer benefit, technical testing, and an intention to be deployed in Bahrain after the sandbox period ends.
The framework provides a virtual space for companies to test their technology-based innovative solutions, and is open to existing CBB licensees and other local and foreign firms.
The testing duration is nine months, with a maximum extension of three months.
Embracing fintech
The sandbox is part of the kingdom’s efforts to encourage growth in the fintech industry.
Rasheed Mohammed Al Maraj, governor of CBB, said: “These new initiatives are a continuation of the CBB’s efforts to provide the right mix of policies and products to develop and enhance the quality and competitiveness of services in the financial sector.
“We are living in an era of unprecedented changes mainly brought about by technological advancement, where we are witnessing how technology is defining financial services and CBB remains at the forefront of these developments to enable the industry to advance similarly.”
Khalid Al Rumaihi, chief executive of the country’s Economic Development Board (EDB), said: “In order to grow the fintech industry, we know we need to create an ecosystem in which entrepreneurs can innovate and test their ideas – and the introduction of sandbox regulations is one of the key steps towards ensuring that environment.
“Bahrain has always been an attractive proposition for fintech – particularly due to our unique offering in areas such as Islamic finance and payments, and we are looking forward to welcoming more local, regional, and international fintech firms.”
