Bangladesh Bank has approved the first two digital banks in the country: Nagad Digital Bank Plc and ACI’s “Kori” Digital Bank Plc. The banking regulator decided to issue letters of intent (LoI) to two digital banks in a board meeting today.
The board also decided to allow bKash of Brac Bank, Digit All of Bank Asia and Digi10 of 10 commercial banks to open digital banking windows after preparing necessary guideline for the window.
These three digital banking windows will be approved as they already have banking licenses. The banking regulator will assess Nagad Digital Bank Plc and Kori Digital Bank Plc and then issues LoIs to Smart Digital Bank, Japan Bangla Digital, and North East Digital Bank.
Three committees of the central bank assessed 52 applications for opening digital banks, BB Executive Director and Spokesperson Md Meshbaul Haque told journalists after the meeting presided over by Bangladesh Bank Governor Abdur Rouf Talukder.
The committee shortlisted the names of nine proposed digital banks and placed the list in the central bank’s board meeting.
Of the nine, the Bangladesh Bank board did not take into consideration a digital banking proposal, as it was submitted by an insurance company.
The LOI will define a timeline for digital banks to set up their infrastructure and launch their services. Digital banks won’t have physical branches, sub-branches, or ATM booths, and they won’t support in-person transactions.
The central bank made these guidelines for digital banks public on 14 June this year. Digital banks will follow the governance outlined in the guidelines and be regulated under the Banking Company Act.