Kathmandu. Bangladesh Bank, the central bank of Bangladesh, is issuing a license to operate a digital bank to expand information technology-based financial services.
The central bank has invited applications from interested investors to set up a bank that is based entirely on information technology and serves customers in an unphysical manner.
Interested investors can apply for a digital bank license by September 30. The central bank’s notification recognises the changing global financial ecosystem driven by technological innovation and the challenges that these changes bring. It has emphasized its role in enhancing efficiency in financial services delivery and widening the reach of the financial system.
Digital banks are seen as key enablers in improving access to credit, supporting marginalized groups, creating jobs and promoting long-term food security.
Bangladesh Bank has decided in principle to issue licenses to suitable applicants under Section 31 of the Bank Companies Act, 1991. Eligible sponsors will have to submit a sealed proposal along with 500,000 Bangladeshi rupees as application fee.
Digital Bank provides all the services to the customers through mobile app or website. Such banks do not have branch offices.
Nabil Bank has already started the practice of digital bank under the Neo Bank brand in Nepal. However, there is still no policy arrangement regarding digital banks in Nepal.
The government has stated in the policy and programme of the current fiscal year that a digital bank will be established by making policy and legal provisions regarding digital banks. Although the subject of such a bank has been included in the policy, program and budget statement since 2080 BS, no policy arrangement has been made so far.
The government has registered a bill to amend the Banks and Financial Institutions Act, 2063 BS on March 1, 2080. The bill is yet to be passed by parliament.
