The Reserve Bank of India (RBI) has proposed the inclusion of ‘Theme Neutral’ applications under its ‘On Tap’ Regulatory Sandbox (RS) facility, enabling innovators to submit proposals at any time without thematic restrictions. The move aims to encourage continuous fintech innovation and adapt to the evolving financial landscape.

This initiative allows financial technology (fintech) companies to continuously test innovative products and services under a controlled regulatory environment, without waiting for specific application windows. ​

Since its launch in 2019, the RBI’s Regulatory Sandbox has completed four thematic cohorts (Retail Payments, Cross-border Payments, MSME Lending, and Financial Fraud Prevention) and is currently testing a fifth ‘Theme Neutral’ cohort, set to conclude in May 2025.

What this means

"Fintech firms can now submit applications to test their products at any time, fostering ongoing innovation in the financial sector.​ The 'On Tap' facility offers a flexible and on-demand approach to product testing, enabling companies to adapt quickly to market needs," said Yogita Dand, Certified Financial Planner and Registered Mutual Fund Distributor. "Participants receive regulatory guidance and potential relaxations, facilitating the development and refinement of financial products, Dand added.

Key features of the ‘On Tap’ theme-neutral facility

Open for any fintech innovation under RBI’s regulatory scope.

• Illustrative focus areas include:

Prashant Mishra Founder & CEO of Agnam Advisors, said, "Since 2019, the RBI's Sandbox has conducted trials for over 90 applications across various cohorts, such as Retail Payments (applications: 32 shortlisted: 6 all 6 exited successfully); Cross-border Payments (applications: 27 shortlisted: 8 exited: 4); MSME Lending (applications: 22 shortlisted: 8 exited: 5); and Prevention & Mitigation of Financial Frauds (applications: 9 shortlisted: 6 exited: 3)."

The RBI aims to promote fintech growth while ensuring regulatory compliance, offering innovators a structured testing environment.

"A fifth cohort called "Theme Neutral" came into effect in October 2023 clogging pathways for 22 applications (5 are still testing). With the RBI now allowing "On Tap" opens up applications for innovators any time instead of waiting for a particular theme or timeline. With this change, continuous innovation can be furthered, from testing technologies such as digital lending, AI, and block technologies, while ensuring structured oversight for risk management, consumer protection, and compliance. As this change in approach lowers the Sandbox demands and attracts more players into the Sandbox, the RBI has set the stage for a more agile and inclusive fintech ecosystem, where successful solutions can rapidly scale to address the diverse financial needs of the Indian economy," said Mishra.