NBE to Launch Fintech Sandbox by Year-End to Spur Innovation

The National Bank of Ethiopia (NBE) is set to launch a regulatory sandbox by the end of 2025, a landmark initiative designed to accelerate financial technology innovation in a controlled environment. The move will allow banks and fintech startups to test new products and services, from digital lending to new payment platforms, with real consumers under the direct supervision of the central bank.

The sandbox aims to de-risk and speed up the "go-to-market" timeline for new financial products by clarifying regulatory requirements and providing a safe space for experimentation. In the past, regulatory uncertainty has stalled the rollout of innovative services, including a mobile branch service and a digital banking platform from the Bank of Abyssinia, which were halted due to the lack of a clear legal framework.

The establishment of the sandbox, a concept successfully implemented in countries like Kenya to scale mobile money, is a key pillar of Ethiopia's Digital Ethiopia 2025 strategy. Its launch, a joint effort with the Ethiopian Capital Market Authority (ECMA) and supported by the UNDP's Innovative Finance Lab, will be a significant near-term catalyst for the country's burgeoning fintech ecosystem.