The House of Lords Financial Services Regulation Committee today
invites submissions to its new inquiry into regulatory sandboxes.
The inquiry will examine how regulators and firms use regulatory
sandboxes, and whether they drive innovation in the industry.
The Committee will explore whether regulatory sandboxes support
innovation; their role in supporting the development of
regulation; whether they represent value for money and public
benefit; and the degree to which the selection of participating
firms can influence the market.
The committee is seeking evidence on the following questions:
- What purposes do regulatory sandboxes serve in UK financial
services?
- Has their role changed in the 10
years since the launch of the first FCA sandbox in 2016?
- What has been the impact of regulatory sandboxes in UK
financial services, and how has this been measured?
- Has the long-term impact of
regulatory sandboxes been sufficiently assessed?
- Have regulatory sandboxes improved innovation and competition
in UK financial services?
- Do regulatory sandboxes provide wider public benefit and
value for money, compared with other forms of regulatory and
market engagement?
- Why do firms choose to apply, or not to apply, to participate
in a regulatory sandbox?
- How well do the eligibility criteria and selection processes
for regulatory sandboxes operate?
- What effects does participation in a regulatory sandbox have
on participating and non-participating firms, investors and the
wider market?
- What role should regulatory sandboxes play in informing the
development of regulation, particularly for emerging
technologies?
- How effectively do regulators learn
from regulatory sandboxes? To what extent are learnings from
regulatory sandboxes shared or used more widely?
- How effectively do regulatory sandboxes manage risks to
consumers and markets, and what safeguards and accountability
arrangements are in place?
- To what extent are regulatory sandboxes being used to test
agentic AI, and does this introduce any new risks for the use of
regulatory sandboxes?
- How does the UK's use of regulatory sandboxes in financial
services compare with approaches in other jurisdictions and
sectors?
Commenting on the launch of the new inquiry, The DBE, Chairman of the
Financial Services Regulation Committee, said:
"We have launched this inquiry to assess the impact of regulatory
sandboxes. There has been surprisingly little evaluation of how
sandboxes work in practice and what effect they have, even as new
types of sandboxes continue to be introduced. We want to examine
how they are used by both the regulators and the firms that
participate, and whether they are successful in driving
innovation.
We welcome evidence and views from anyone with expertise or
interest in this area, especially from firms that both have and
have not participated in a sandbox.
The deadline for the submission of written evidence is
5pm on Friday 23 October 2026.
Read the call for evidence to find
out how to submit evidence.
