Harnessing Fintech for Sustainable Development: Evaluating the Role of Regulatory Sandboxes

Yetunde Amodu, Nneoma Azubuike and Merron Aberra Tassew
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Yetunde Amodu: New York University School of Law, New York, United States.
Nneoma Azubuike: University of Southern California, Marshall School of Business, United States.
Merron Aberra Tassew: University of Southern California, Marshall School of Business, United States.

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Abstract: Financial technology holds significant potential to advance sustainable development goals, yet regulatory frameworks struggle to balance innovation with stability and financial inclusion. Regulatory sandboxes have emerged as a prominent tool to facilitate Fintech experimentation, but their effectiveness in consistently driving sustainability outcomes remains contested. This analysis employs a qualitative assessment of global regulatory approaches, examining sandbox structures in jurisdictions like the UK, Singapore, Kenya, Sierra Leone, and Malaysia, alongside alternative strategies. It evaluates design elements, benefits, limitations, and real-world impacts on sustainability objectives, drawing on policy documents, regulatory reports, and empirical studies. Findings indicate that while sandboxes can reduce time-to-market and foster dialogue, their impact on sustainability is often indirect and constrained by access barriers, operational costs, and scalability issues. Thematic sandboxes explicitly targeting specific Sustainable Development Goals, such as financial inclusion or green finance, demonstrate greater efficacy. Sustainable outcomes are significantly enhanced when sandboxes are integrated with supervisory technology (SupTech) for real-time monitoring, cross-border regulatory cooperation, and the embedding of mandatory sustainability metrics within core prudential frameworks, as seen in Kenya and Malaysia. Regulatory sandboxes alone are insufficient. Achieving meaningful Fintech contributions to sustainability requires a systemic approach combining targeted experimentation, technological oversight tools, international collaboration, and regulatory mandates that explicitly prioritise and measure sustainable outcomes.

Date: 2025-08-18
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Published in Journal of Global Economics, Management and Business Research, 2025, 17 (3), pp.45-55

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