A number of central banks, including the BSP, have turned to the “test and learn” approach, more recently known as the “regulatory sandbox” to address this gap. The “sandbox” approach presupposes a dialogue and collaborative relationship between the central bank and the industry innovators.
It acknowledges that financial inclusion solutions often arise from these innovators because the latter have greater flexibility and technical capacity to create products and generate systems to deliver them. Essentially, the sandbox provides an opportunity for innovators to connect to banks and other financial system players with clear authority from the regulators.