Digital banks must have paid-up capital of Tk 300cr: BB
The Bangladesh Bank has raised the paid-up capital requirement
for digital banks from Tk 125 crore to Tk 300 crore.
The banking regulator refixed the capital requirement for the upcoming digital banks under the power of Section
13 of the Bank Company Act, 1991 (as amended up to 2023), the central bank said
in a notice yesterday.
The paid-up capital shall only comprise ordinary shares,
according to the guideline.
The
banking regulator revised the capital requirement as applications will soon be
invited for digital banks, said a senior BB official.
Under the previous government, preliminary approval was given to Nagad Digital
Bank and Kori Digital Bank.
However, the initiative was suspended after the fall of the
Awami League government in August 2024.
A
branchless, end-to-end virtual banking system can provide momentum to extending
banking services to the last mile of the country, as per the digital bank
guideline.
The sponsors of the proposed digital bank must provide the initial minimum
paid-up capital, and the bank must go for an initial public offering (IPO)
within five years from the date of licence issuance by BB, the guideline said.
It added
that the amount of the IPO should not be less than the sponsors' initial
paid-up capital.
The
central bank approved a guideline on digital banks in 2023 with an aim to
expedite the process of cashless transactions and digital transformation in the
country.
The
decision came within two weeks after then finance minister AHM Mustafa Kamal in
his budget speech said a Bangladesh Bank committee was working to work out
strategies to broaden and accelerate financial inclusion effort.
Under the guideline, the major difference is that digital banks
will have only a headquarters, and no other physical presence, while
conventional banks have physical presence across the country.
The
business, governance, and operational requirements applicable to traditional
banks in general shall continue to apply to digital banks, according to the
guideline.