# HKMA GenA.I. Sandbox circular: Generative Artificial Intelligence Sandbox (HKMA circular inviting applications to the GenA.I. Sandbox, 20 September 2024)

Source: https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024
Last updated: Oct 5, 2026

The HKMA's circular of 20 September 2024 invited Authorized Institutions to apply to the Generative AI (GenA.I.) Sandbox that the HKMA and Cyberport announced on 13 August 2024. The Sandbox gives banks a risk-controlled environment to develop, test and pilot AI-based solutions in real-world banking scenarios, with Cyberport computing power and targeted supervisory feedback. Applications for the first cohort closed on 15 November 2024, selected projects were to begin within a month of announcement and finish within six months, and participants had to submit regular progress updates and a final report. The first cohort was announced on 19 December 2024 and the Sandbox has since had a second cohort and an expansion to the cross-sector GenA.I. Sandbox++.

## At a glance

| Field | Value |
| --- | --- |
| Authority | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) |
| Type | Circular |
| Status | In force |
| Published | Sep 20, 2024 |
| Applies to | Authorized Institutions in Hong Kong, invited to apply for participation, ideally with fintech and AI partners. Participation is voluntary; the sandbox does not relax regulatory requirements and the circular does not impose duties on banks that do not apply. |
| Official text | https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20241118-1-EN/20241118-1-EN.pdf |

## Key points

- Purpose: a risk-controlled environment for AIs to develop, test and pilot innovative AI-based solutions in real-world banking scenarios, using Cyberport's computing power and receiving targeted supervisory feedback throughout the trial.
- Focus: use cases on enhancing risk management, anti-fraud measures and customer experience, including Retrieval-Augmented Generation, model adaptation, fine-tuning of pre-trained models or training new models.
- Supervisory purpose: based on trial results the HKMA will share good practices and consider the need for further supervisory guidance on the adoption of AI, citing its 1 November 2019 High-level Principles on Artificial Intelligence.
- Timetable for the first cohort: applications accepted until 15 November 2024; selected projects to start within one month of announcement (tentatively December 2024) and complete within six months, with extensions considered case by case.
- Obligations on participants: regular progress updates and a final report on project completion.
- Prioritisation (Annex): level of innovation, complexity of the solution, expected contribution to the industry and adherence to the principle of fair use; collaboration with fintech firms from the Cyberport catalogue is encouraged.
- Cohorts since: first cohort announced 19 December 2024 (15 use cases, 10 banks, four technology partners); second cohort opened 28 April 2025 and was announced on 15 October 2025 (27 use cases, 20 banks, 14 technology partners).
- Expansion: a joint circular of 5 March 2026 from the HKMA, SFC, Insurance Authority and MPFA created the GenA.I. Sandbox++ across banking, securities, insurance, MPF and stored value facilities.

## What changed for banks

It converted the HKMA's August 2024 announcement into an application route and set the model for later cohorts. For banks it created a way to test GenAI under supervisory feedback, and for the HKMA a channel for evidence that informs further guidance.

## Use cases it governs

- [Generative & agentic AI](https://www.bankingnewsai.com/ai-regulation/by-use-case#generative-agentic-ai)
- [Fraud detection](https://www.bankingnewsai.com/ai-regulation/by-use-case#fraud)
- [Customer-facing chatbots](https://www.bankingnewsai.com/ai-regulation/by-use-case#customer-chatbots)
- [AI governance (general)](https://www.bankingnewsai.com/ai-regulation/by-use-case#governance-general)
- [Model risk management](https://www.bankingnewsai.com/ai-regulation/by-use-case#model-risk)

## How does the HKMA GenA.I. Sandbox work for banks?

The HKMA GenA.I. Sandbox, run with Cyberport, lets Authorized Institutions develop, test and pilot AI and generative AI solutions in real-world banking scenarios in a risk-controlled environment, with Cyberport computing power and targeted supervisory feedback. The circular of 20 September 2024 opened the first cohort: applications until 15 November 2024, projects starting within a month of announcement and finishing within six months, regular progress updates and a final report from each participant. Applications are prioritised on innovation, complexity, contribution to the industry and fair use, and use cases are expected to focus on risk management, anti-fraud and customer experience. The HKMA says it will share good practices and consider further supervisory guidance from the trials, and later circulars launched a second cohort (28 April 2025) and the cross-sector Sandbox++ (5 March 2026).

| Rule | Authority | What it requires | Status | Source |
| --- | --- | --- | --- | --- |
| Circular, invitation paragraph — Apply to participate | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | Interested AIs apply for the GenA.I. Sandbox; applications for the first cohort were accepted until 15 November 2024. | Closed 15 November 2024 | [HKMA GenA.I. Sandbox circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024) |
| Circular, project timetable — Start and duration | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | Selected projects should begin within one month of announcement and be completed within six months; extension requests may be considered case by case. | First cohort, from December 2024 | [HKMA GenA.I. Sandbox circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024) |
| Circular, participant duties — Reporting | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | Participants submit regular progress updates and a final report upon project completion. | For each selected project | [HKMA GenA.I. Sandbox circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024) |
| Annex — Prioritisation factors | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | Applications are prioritised on innovation, complexity, expected contribution to the industry and adherence to the principle of fair use. | First cohort | [HKMA GenA.I. Sandbox circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024) |
| Second-cohort circular, 28 April 2025 — AI safety validation | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | All use cases in the second cohort were expected to incorporate robust A.I. safety validation into technical trials and evaluations; use cases with A.I.-assisted second and third lines of defence were encouraged. | Applications closed 31 August 2025 | [official text](https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20250428-2-EN/20250428-2-EN.pdf) |
| Practical Insights Report, 31 October 2025 — Good practice guidance | [HKMA](https://www.bankingnewsai.com/ai-regulation/hkma) | The HKMA encouraged all AIs to review the report on data preparation, model fine-tuning, output evaluation and ongoing monitoring when innovating with AI responsibly. | From 31 October 2025 | [official text](https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20251031-6-EN/20251031-6-EN.pdf) |

The Sandbox is an enabling programme rather than a rule. It gives supervisory feedback during trials, and the HKMA's circular points to the 1 November 2019 High-level Principles on Artificial Intelligence as the existing guidance it may revisit. Banks that do not participate are not required to do anything under this circular.

From March 2026 the same model extended to other sectors through the GenA.I. Sandbox++, which in its first cohort announced on 27 August 2026 focuses on agentic AI.

### What this means in practice

- If piloting GenAI, use the Sandbox cohorts to obtain supervisory feedback before launching customer-facing use cases.
- Include AI safety validation, bias detection and explainability components in any Sandbox proposal, which later cohorts treat as expected.
- Read the Practical Insights Report of 31 October 2025 as the HKMA's own summary of lessons on data preparation, fine-tuning, output evaluation and monitoring.
- Plan for reporting duties (progress updates and a final report) when staffing a Sandbox project.

## FAQ

### What is the HKMA GenA.I. Sandbox?

A programme run by the HKMA with Cyberport that gives Authorized Institutions a risk-controlled environment to develop, test and pilot AI solutions, with GPU computing power at Cyberport and targeted supervisory feedback. It was announced on 13 August 2024 and opened to applications by a circular dated 20 September 2024.

### Who can join the HKMA GenA.I. Sandbox?

The 2024 circular invited Authorized Institutions under the Banking Ordinance. Since the 5 March 2026 joint circular, the GenA.I. Sandbox++ also covers licensed corporations, insurers and insurance brokers, MPF trustees and intermediaries, and stored value facility licensees, through their respective regulators.

### Does the GenA.I. Sandbox change the HKMA's AI rules for banks?

No. It gives supervisory feedback and a testing environment rather than regulatory relaxations; the HKMA's AI principles and GenAI consumer-protection circular continue to apply. The HKMA said it would share good practices and consider whether further supervisory guidance is needed.

### Is the HKMA GenA.I. Sandbox still open?

The first-cohort window of the 2024 circular closed on 15 November 2024, and the second-cohort window closed on 31 August 2025. The GenA.I. Sandbox++ accepted applications until 30 June 2026 and announced its first cohort on 27 August 2026.

## Related documents

- [HKMA GenA.I. Sandbox++ joint circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-plus-plus-2026) — Joint Circular on the Expansion of Generative Artificial Intelligence Sandbox (HKMA, SFC, Insurance Authority and MPFA, 5 March 2026) (Mar 5, 2026)
- [HKMA circular on AI for monitoring of suspicious activities](https://www.bankingnewsai.com/ai-regulation/documents/hkma-ai-aml-monitoring-2024) — Use of Artificial Intelligence for Monitoring of Suspicious Activities (HKMA circular, 9 September 2024) (Sep 9, 2024)
- [HKMA GenAI consumer protection circular](https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-consumer-protection-2024) — Consumer Protection in respect of Use of Generative Artificial Intelligence (HKMA circular, 19 August 2024) (Aug 19, 2024)
- [HKMA BDAI consumer protection principles](https://www.bankingnewsai.com/ai-regulation/documents/hkma-bdai-consumer-protection-2019) — Consumer Protection in respect of Use of Big Data Analytics and Artificial Intelligence by Authorized Institutions (HKMA circular, 5 November 2019) (Nov 5, 2019)
- [HKMA High-level Principles on Artificial Intelligence](https://www.bankingnewsai.com/ai-regulation/documents/hkma-high-level-principles-ai-2019) — High-level Principles on Artificial Intelligence (HKMA circular to all Authorized Institutions, 1 November 2019) (Nov 1, 2019)
- [Bailey: Frontier AI and the Question of Governance (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/boe-bailey-frontier-ai-governance-2026) — Frontier AI and the Question of Governance — Governor Andrew Bailey (Sep 30, 2026)
- [Atkins remarks at Investor Advisory Committee (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/sec-atkins-iac-ai-disclosure-remarks-2026-09) — Remarks at the SEC Investor Advisory Committee Meeting on AI Technologies and the Public Markets Information Ecosystem (Sep 10, 2026)
- [FIN-2026-Alert005 (Digital Asset Investment Scam Centers)](https://www.bankingnewsai.com/ai-regulation/documents/fincen-alert-2026-scam-centers) — FinCEN Alert on Money Laundering Activity Associated with Digital Asset Investment Scam Centers (Sep 3, 2026)

Last reviewed Oct 5, 2026. Cite the official text (https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20241118-1-EN/20241118-1-EN.pdf) for the rule and this page for the summary and dates.

---

Canonical page: https://www.bankingnewsai.com/ai-regulation/documents/hkma-genai-sandbox-2024
Part of [BankingNewsAI](https://www.bankingnewsai.com/) — a free daily brief on AI in banking, an AI regulation tracker (41 authorities, 237 documents) and AI-strategy profiles of the 120 largest US banks. Markdown versions of every reference page: append `.md` to the page URL; index at https://www.bankingnewsai.com/llms.txt.