Bangladesh Bank awaits applications for digital bank

The central bank took a significant step forward in its bid to propel Bangladesh towards a cashless society through digital banking by unveiling a web portal to facilitate applications to join the initiative.

Launched on Jun 21, the web portal was intended to streamline the application process for individuals and businesses interested in setting up the country's maiden digital bank.

A bdnews24.com report, published on Saturday, said the web portal has not received any application so far from parties interested in setting up digital bank.

As the web portal will only be available for 42 days, the central bank is hoping for a quick turnaround before the August 1 deadline, the report said.

Addressing the lack of engagement, Zakir Hossain Chowdhury, a spokesman for the Bangladesh Bank, said, "The web portal is accessible round the clock for interested parties to submit applications online. Bangladesh Bank will evaluate each application diligently."

Mobile financial service giants bKash and Nagad have shown interest in participating in the digital banking revolution. However, the firms have been treading cautiously as they continue to analyse the policies and requirements set forth by the Bangladesh Bank before finalising their applications.

bKash said it will submit an application once it ensures compliance with all the necessary conditions for setting up a digital bank. To that end, the company has already acquired clearance from the Office of the Registrar of Joint Stock Companies and Firms.

“We’ll apply as soon as we’re done making all preparations," said Shamsuddin Haider Dalim, head of bKash's corporate communications and PR department.

Nagad, too, has been circumspect in its approach to the venture. As digital banking is a novel initiative in the country, the firm will take its time to ensure alignment with the policy requirements before submitting its application, according to Zahidul Islam, Nagad's head of public relations.

The Bangladesh Bank has imposed a requirement of Tk 1.25 billion as paid-up capital to ensure that only financially stable companies can acquire a digital banking licence. Moreover, the central bank has made it clear that loan defaulters will be excluded from the pioneering initiative.

Despite the lukewarm response to the web portal so far, the groundwork for the digital banking initiative was laid in large part by the success of existing mobile financial services in Bangladesh.