A total of 52 domestic and foreign entities have applied to the central bank for the licence to set up digital banks, The Business Standard (TBS) reported Sunday (20 August).
The banking regulator is yet to publish the complete list of applicants. But TBS has obtained a Bangladesh Bank document with the names of 40 companies out of 52 that are vying for the permit.
As per the central bank document, the applicants for digital bank licence include Alliance Fingular Islami Digi Bank PLC; Nagad Digital Bank PLC; bKash Digital Bank PLC; Digi Ten PLC; Digital Bank PLC; Upay Digital Bank PLC; JRF Digital Bank (BD) PLC; Japan Bangla Digital Bank PLC; Elegant Digital Bank PLC; Digi Bank PLC; North East Digital Bank PLC; Next Century Digital Bank PLC; Adhunik Bank PLC; Somriddhi Digital Bank PLC; Desh Digital Bank PLC; Shonchoy Digital Bank PLC; Smart Digital Bank PLC.
Besides, Shompod Digital Bank PLC; North West Digital Bank PLC; Bijoy Digital Bank PLC; NUH Digital Bank PLC; Uddipan Digital Bank Ltd; UNO Digital Bank PLC; Shomoy Digi Bank PLC; Amar Digi Bank PLC; Zamzam-Islami Digital Bank PLC; Islami Digital Bank PLC; Shuborno Digital Bank PLC; Ekota Digital Bank PLC; Sunam Digital Bank Ltd; Bangladesh Digi Bank plc; Aalo Digi Bank PLC; Aasha DigiBank PLC; Delta DiGi Bank Ltd; Starline Digital Bank PLC; Shadin Digital Bank; Pathao Digital Bank PLC; Agami Digital Bank PLC; Artist Digi Bank PLC; and Shetu Digi Bank PLC applied as well.
A digital bank will operate without any branches, sub-branches, or ATM booths. There will be no in-person transactions, according to the Digital Bank guidelines approved by the central bank on 14 June.
Banking services will be provided to customers only using mobile and digital devices.
In accordance with the guidelines, the central bank introduced a web portal on 21 June to facilitate the online submission of applications for the 'Digital Bank' licence. The applicants were initially asked to apply for the licences by 1 August. However, since no applications were received within the deadline, the application period was extended until 17 August.
The Bangladesh Bank has set the minimum capital requirement for a digital bank at Tk125 crore when a conventional bank requires Tk500 crore to get the licence.
The minimum shareholding of each sponsor will be Tk50 lakh (maximum 10% or Tk12.5 crore), according to sources of the Registrar of Joint Stock Companies and Firms (RJSC).
A digital bank will be governed by the Banking Company Act, according to the central bank guidelines.
The policy also outlines a requirement for digital bank entrepreneurs to engage in a capital preservation agreement. In case a bank's capital falls below a certain threshold, entrepreneurs are obligated to provide additional capital. Individuals with outstanding debts are ineligible to become digital bank entrepreneurs.
Additionally, individuals with pending cases of loan defaults against them are not eligible to apply.
A consortium of 10 private sector banks in the country has collaboratively taken the initiative to launch a digital bank named 'DG10 Bank PLC.
The banks are – City Bank, Mutual Trust Bank (MTB), Eastern Bank Limited (EBL), Dutch Bangla Bank Limited (DBBL), Trust Bank, Prime Bank, Pubali Bank, National Credit and Commerce Bank (NCCB), Mercantile Bank and Midland Bank.
Four state-owned banks - Sonali, Agrani, Janata, and Rupali – also want to set up another digital bank.
State-run Mobile Financial Service (MFS) provider Nagad, bkash, mobile operator Banglalink, and digital services company Pathao have applied to get the licence to set up a digital bank as well.