Innovation Sandbox Programme

As part of Consultation Paper 156 (“Central Bank approach to innovation engagement in financial services”), which launched in November 2023, Central Bank of Ireland outlined its intention to establish an Innovation Sandbox Programme.

The Innovation Sandbox Programme will inform the early stage development of selected innovative initiatives (consistent with public policy objectives) and provide regulatory advice and support.

For more detail on our proposal for the Innovation Sandbox Programme, please see the Consultation Paper and our subsequent Feedback Statement in response to innovation ecosystem feedback.

What is the Innovation Sandbox Programme?

The Central Bank will establish and deliver the Innovation Sandbox Programme later in 2024, which aims to provide regulatory advice and support for innovative projects.

The programme will take a thematic approach and prioritise innovations that promote better outcomes for consumers and the financial system.

The programme will take place over six months to allow the innovation develop. The methodology and delivery of these programmes will be subject to continual assessment and impact review.

The Innovation Sandbox Programme will not provide any derogation or waivers from regulation but we will seek to apply the applicable regulatory frameworks proportionally with an outcome focused, risk-based approach.

There will not be any digital testing of products with consumers in the programme.

Further information on the Innovation Sandbox Programme and applications process will be available in September.

What is the theme of the Innovation Sandbox Programme?

The theme of the Innovation Sandbox Programme is:

Combatting financial crime:  Through the use of innovative technology, foster and develop solutions that minimise fraud, enhance KYC/AML/CFT frameworks, and improve day to day transaction security for consumers.

The challenge

  • Trust is one of the fundamental cornerstones of a well-functioning, resilient financial system. Financial crime erodes this trust for those who rely on its integrity.
  • The fight against financial crime diverts resources away from economically and socially productive uses and can negatively affect a country's financial system by undermining its stability.
  • The pace of innovation and new technologies has meant companies are vulnerable to criminals as they introduce innovations.
  • Globally, scams drove over $1 trillion in financial losses in 2023, while losses from Authorised Push Payment scams was valued at €9.9 million in Ireland in 2022, according to FraudSmart.
  • Financial crime is not just an issue for the financial sector, but for other sectors too. One of the key factors in successfully reducing financial crime is for firms and wider partners to work collaboratively sharing data and intelligence.

The Problem Statements

  1. Overall: What technological solutions can help to deliver positive outcomes for consumers and firms that support them in combatting financial crime and fraud?
  2. Collaboration: Can collaboration and information sharing between and within the financial system, technology providers and other stakeholders enhance the effectiveness of anti-money laundering and counter terrorism financing efforts?
  3. Firm obligations: How can innovative technology, including AI, be deployed to support firms to effectively meet their regulatory obligations?
  4. Patterns: How can technology be better deployed to detect patterns or other indicators of consumer behavior that may indicate financial crime is taking place?
  5. Consumer protection: How can efforts to combat financial crime ensure that the solutions do not comprise privacy, data, security or consumer protection?
  6. Regulatory adaptability: What are the impacts of the changing trends and emerging technologies in financial crime on the regulatory frameworks and to what extent do the current regulatory frameworks enable or hinder the use of technology to combat financial crime?

When will the Innovation Sandbox commence?

Applications for the Innovation Sandbox Programme will open in September 2024. More information will be available on this page at that time.

The Innovation Sandbox Programme will commence in December 2024 and the programme will run for six months.

What if I have questions?

You can contact us at: [email protected]

Please note that in initial calls or emails we cannot address complex regulatory questions and we cannot confirm whether an application would be successful.

Further updates will be provided on this page as they become available.

See also: