The Central Bank of Nigeria (CBN) has opened applications for the second cohort of its regulatory sandbox, inviting financial institutions and innovators to test new financial products and technologies within a controlled regulatory environment.

Applications opened on August 11, 2026, and interested organisations have until August 31, 2026 to submit their applications.

The sandbox is designed to give innovators an opportunity to develop and test financial solutions while working within a structured environment supervised by the regulator. It is part of the CBN's broader effort to encourage innovation without compromising financial stability, consumer protection and regulatory compliance.

What the CBN is looking for

The second cohort has a strong focus on emerging areas of financial technology. The CBN is inviting applications for solutions involving fiat-backed stablecoin payments, digital wallet infrastructure, stablecoin exchanges, open banking, fraud prevention and real-time risk analytics, among other financial innovations.

The focus areas reflect some of the biggest changes taking place across Nigeria's financial sector. Digital payments continue to expand, while stablecoins are increasingly being used for payments and cross-border transactions.

Open banking is also expected to create new opportunities by allowing customers to securely share financial information with authorised third-party providers and enabling companies to build new products around banking data.

A controlled environment for financial innovation

Regulatory sandboxes allow financial companies to test new products under defined conditions before deploying them more broadly.

For innovators, this can provide an opportunity to identify regulatory, technical and consumer-protection challenges early. For regulators, it provides insight into how new technologies work in real-world environments and what rules may be required to govern them.

The CBN launched its first regulatory sandbox in 2023. The second cohort signals a continued willingness to engage with new financial technologies as Nigeria's digital financial ecosystem develops.

Stablecoins take a bigger role

The inclusion of stablecoin-related solutions is particularly notable.

Stablecoins are digital assets designed to maintain a relatively stable value against an underlying asset, commonly the US dollar. They have gained attention in Nigeria and other African markets because they can provide another way for businesses and individuals to move value across borders.

Financial institutions are also exploring how stablecoins can improve the speed and efficiency of international payments.

By specifically inviting applications involving fiat-backed stablecoin payments and exchanges, the CBN is creating space for regulated experimentation around an area that has previously presented significant regulatory challenges.

Open banking could receive another push

The sandbox could also have implications for Nigeria's open banking ambitions.

The CBN issued its open banking operational guidelines in 2025 following years of industry advocacy. However, the framework has not yet been accompanied by a clearly defined timeline for full implementation.

The decision to include open banking providers among the areas targeted by the new sandbox could therefore be an encouraging signal for companies waiting to develop products around the framework.

Testing these solutions in a controlled environment could help regulators and industry participants identify practical issues before wider adoption.

Fraud prevention is another priority

The CBN is also seeking solutions focused on fraud prevention and real-time risk analytics.

This comes as digital financial services continue to expand and financial institutions face increasingly sophisticated forms of fraud.

Real-time analytics can help financial institutions identify unusual transaction patterns, detect potential fraud and respond to risks more quickly.

For fintech companies developing tools in this area, the sandbox could provide an opportunity to demonstrate how their technology performs under controlled conditions.

What applicants need to provide

Companies seeking admission will need to demonstrate that they are prepared to operate within the sandbox's regulatory requirements.

Applications are expected to include documentation covering board or management approval, anti-money laundering and counter-terrorism financing policies, corporate information and relevant regulatory details.

The CBN will also assess applicants based on several factors, including the level of innovation offered by the proposed solution and its potential benefit to the market.

Other considerations include governance, technical capabilities, consumer protection and the organisation's overall readiness to participate in the programme.

Why the development matters

The second sandbox cohort comes at a time when Nigeria's financial ecosystem is rapidly expanding beyond traditional banking products.

Fintech companies are building services around payments, digital wallets, financial data, fraud prevention and digital assets. At the same time, regulators are trying to ensure that innovation develops within a framework that protects consumers and maintains confidence in the financial system.

The sandbox provides a middle ground between unrestricted experimentation and immediate full-scale regulation.

A changing regulatory environment

The move also comes amid broader changes in Nigeria's approach to virtual assets and digital finance.

After years of uncertainty surrounding cryptocurrencies and other virtual assets, the government has taken steps toward establishing a more coordinated regulatory structure, including the creation of a Virtual Assets Council.

The renewed attention to stablecoins and related financial infrastructure suggests that digital assets are increasingly being considered as part of the country's wider financial system rather than simply as a separate technology sector.

What happens next

With applications open until August 31, fintech companies and financial institutions developing solutions in the targeted areas now have a limited window to apply.

The success of the programme could help determine how quickly some emerging financial technologies move from experimentation into wider regulated use.

For Nigeria's fintech ecosystem, the most important signal may be that regulators are increasingly creating mechanisms to engage with new technology directly.

Rather than waiting for innovations such as stablecoin payments, open banking and real-time fraud systems to mature outside the regulatory system, the CBN is giving selected innovators a structured path to test their ideas under regulatory supervision.