The Sandbox Approach

  • Majid Lotfi Ghahroud Ph.D. in Financial Management, Faculty of Management, University of Tehran, Iran
  • Niloufar Ebrahimiyan Master of Science in Financial Management, Alzahra University, Tehran, Iran
  • shayan Bastani Allah Abadi Master of Science in Business Management, University of Tehran, Iran
  • Farzad Jafari Ph.D. in Financial Management, Faculty of Management, University of Tehran, Iran
  • Saeid Tajdini Postdoc of Finance, Faculty of Economics, University of Tehran, Tehran, Iran
Keywords: Fintech, Sandbox


Since banking system supports and develops Fintech companies and start-ups around the world, the Fintech industry grows so fast. It is clear that, regulatory sandboxes had positive effects on venture investment, and risk factors in Fintech industry. A FinTech sandbox is an environment that testers and innovators can apply it to check the production environment on a real-time basis. It helps to simulate responses from all the systems and processes. In addition, an application program interface (API) sandbox and Fintech sandbox have a similar meaning. Sandbox enables banks and FinTech companies to experiment with innovative financial products or services. Moreover, it provides a suitable space and duration for checking products and services. Also, the presence of suitable safeguards helps in containing the results of failure. In summary, the sandbox prepares for the pilot testing of newly developed technologies. FinTech companies have encouraged many banks to open their doors to move toward financial technology instead of traditional banking. The simplification of complex banking processes, and improving user experience lead to encourage investors to support Fintech start-ups. However, this ecosystem needs regulatory solutions to overcome new barriers. Since there are 3 separate sections in this field in Iran, we can find a comprehensive policy and features for Sandbox ecosystem in Iran. However, Iran started it recently, and it will be improved in the future. This study aims to find an appropriate the Sandbox approach for Iran based on local ecosystem. To analyze it, we selected some countries (5 countries) which have initially adopted regulatory sandboxes.


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