Press Release on Labuan FSA Grants Two Conditional Approvals Under The Guidelines On The Establishment Of Labuan Islamic Digital Bank Under Sandbox Regulatory Requirements (I-BOX)
Press Release on Labuan FSA Grants Two Conditional Approvals Under The Guidelines On The Establishment Of Labuan Islamic Digital Bank Under Sandbox Regulatory Requirements (I-BOX)
LABUAN, 10 October 2025 – Labuan Financial Services Authority (Labuan FSA) has granted conditional approvals to Green Digital Bank Corp. and Fasset Islamic Digital Bank Limited in 2025 to operate as Islamic digital banks within the Labuan International Business and Financial Centre (Labuan IBFC). The conditional approvals were issued under the Guidelines on the Establishment of Labuan Islamic Digital Bank under Sandbox Regulatory Requirements (iBOX) and Section 63 of the Labuan Islamic Financial Services and Securities Act 2010, enabling both entities to carry on Islamic digital banking business in Labuan IBFC.
Labuan FSA introduced the “Digital Financial Sandbox” in 2024 as part of the initiatives under Islamic Digital Asset Centre (IDAC), which was launched in year 2022 to attract more digital assets and fintech players to Labuan IBFC, and to carve out a niche in the digital Islamic finance space.
Labuan FSA emphasised that under these conditional approvals, both entities are not permitted to commence business operations until they have fully satisfied all operational and prudential requirements stipulated by Labuan FSA. These mandatory prerequisites serve as key safeguards to ensure the institutions’ readiness, sound governance, and full regulatory compliance prior to the issuance of provisional licence and their subsequent transition into the operational phase.
Labuan FSA emphasised that under these conditional approvals, both entities are not permitted to commence business operations until they have fully satisfied all operational and prudential requirements stipulated by Labuan FSA. These mandatory prerequisites serve as key safeguards to ensure the institutions’ readiness, sound governance, and full regulatory compliance prior to the issuance of provisional licence and their subsequent transition into the operational phase.
The issuance of these conditional approvals marks an important milestone in advancing Labuan IBFC’s digital finance agenda and fostering the growth of innovative financial solutions. Notwithstanding this, Labuan FSA will continue to maintain close oversight to ensure that all Sandbox participants adhere to the required standards before moving into full operational stages. This measured approach underscores Labuan FSA’s commitment to facilitating innovation while safeguarding market stability and consumer protection.
Labuan Financial Services Authority
10 October 2025
Labuan Financial Services Authority
10 October 2025
FOR FURTHER INFORMATION, PLEASE CONTACT:
Corporate Communication & External Relations Unit
Tel : +603-8873 2000 Fax : +603-8873 2209
E-mail: communication@labuanfsa.gov.my
Website:www.labuanfsa.gov.my
