.svg)
The Central Bank of Ireland’s (CBI) Innovation in Payments Sandbox could accelerate the development of safer, faster, and more inclusive payment solutions while giving regulators early insight into emerging risks.
Applications are open for the initiative, which aims to provide selected firms with a controlled environment to test and refine innovative payment solutions, enhancing both safety and efficiency.
The six-month programme is designed to encourage collaboration across the payments ecosystem and to accelerate the development of safer, faster, greener and more inclusive payments.
Participants are set to benefit from structured workshops, dedicated support from a sandbox relationship manager and access to data tools and platforms to help refine their innovations.
“Payments are the lifeblood of the economy, and innovation in payments, done well and safely, can unlock broader economic benefits. Amid a rapid pace of innovation in the payments landscape, the Central Bank also needs to adapt, we cannot stand still,” said Vasileios Madouros, the CBI’s deputy governor.
“Our ultimate aim is to ensure that the benefits of innovation are realised and that the risks are managed effectively, maintaining confidence in money and payments throughout this ongoing transition.”
Key initiatives
The sandbox is set to focus on the main challenges facing the payments sector in Ireland, which the government identified as priorities in its National Payments Strategy, launched in October 2024.
Initiatives within the sandbox include:
- ensuring inclusive access to digital financial services;
- making payments seamless and transparent across providers and borders;
- strengthening resilience and security against fraud and cyberattacks;
- integrating emerging technologies such as tokenised payments and AI-powered services in a safe and consumer-focused way.
Applications are open to a wide range of participants, according to the CBI, including incumbent financial firms, fintech start-ups, technology providers, and academic commercialisation projects.
Both standalone entities and partnerships are eligible for the programme, provided their innovations are sufficiently developed for testing. Applicants do not need to be domiciled in Ireland, but they must be offering or planning to offer their service or product in the Irish market.
The CBI believes the programme will not only help firms develop their innovations, but also provide insight into key risks, strengthening oversight while supporting innovation.
“The Sandbox provides an opportunity to further expand engagement between the Central Bank and the private sector in the area of payments,” said Madouros.
“It aims to foster innovative solutions that deliver safer, faster and more inclusive payments for households and businesses, while giving the central bank early insight into emerging risks and supervisory questions.”
Sandboxes around the world
Many countries have established regulatory or innovation sandboxes for financial services and fintech, reflecting the global push to balance innovation with oversight.
The UK was one of the first movers in this field, with the Financial Conduct Authority’s (FCA) Regulatory Sandbox introduced in 2016 to give fintechs a controlled space to test new products.
Singapore’s Monetary Authority of Singapore (MAS) also operates a FinTech Regulatory Sandbox, which has expanded into “Sandbox Plus” to offer grants and broader eligibility. Other countries in the region, such as Thailand and Hong Kong, have followed suit.
Across the Middle East, countries such as the United Arab Emirates, Saudi Arabia and Bahrain have introduced frameworks for testing tokenisation, digital assets and payments.
The focus and scope of these sandboxes vary. Some cover a broad range of financial services, including banking, insurance, and securities, whereas others are narrowly designed around specific segments such as payments.
Their level of maturity also differs: the UK and Singapore have established permanent programmes with multiple cohorts and market-ready launches, but others remain in pilot stages.
However, what unites these initiatives is the ability to provide regulators with early insights into innovation, while giving firms the chance to experiment in a safe environment.
Potential for good outcomes
The outcomes of the various sandbox initiatives have been significant. In the UK, around 75 percent of the first FCA sandbox cohort completed testing, and nearly 90 percent of those firms went on to launch products in the wider market.
Participants in the sandbox have reported faster go-to-market, reduced costs and easier access to investment, with the added benefit of regulatory credibility.
The FCA’s Digital Sandbox pilots have also targeted specific challenges, such as fraud prevention and supporting vulnerable consumers during the COVID-19 pandemic.
In Singapore, Sandbox Plus has provided grants and streamlined processes to reduce financial and regulatory friction, while also connecting firms with investors.
Australia’s Enhanced Regulatory Sandbox has allowed testing periods of up to 24 months, giving firms longer to refine their models before seeking full authorisation.
For regulators, these programmes unlock valuable intelligence on emerging technologies, business models, and potential risks.
This helps supervisory authorities anticipate issues, adapt regulatory frameworks and build consumer protection into innovations early.
For firms, they can help lower the barriers to experimentation, boost credibility with partners and investors and create a platform for collaboration across the financial ecosystem.
Winners all round in Ireland?
The Central Bank of Ireland’s new Innovation in Payments Sandbox builds on these international experiences.
By offering firms early regulatory engagement, access to data tools, tailored workshops and dedicated support, the programme has been crafted to help those in the payment services space reduce uncertainty, refine their offerings and bring them to market faster.
It also positions participating firms as credible, which should foster greater trust among customers, investors and partners.
By combining early regulatory engagement with practical support and access to tools, Ireland’s sandbox has the potential to accelerate innovation while maintaining safety, transparency, and inclusion in the payments ecosystem.
