KARACHI: The State Bank of Pakistan (SBP) has issued no objection certificates to five applicants for establishing Digital Banks. Now, each of five (05) applicants will incorporate a public limited company with Securities and Exchange Commission of Pakistan.

Afterward, they will approach SBP for In-Principle Approval for demonstrating operational readiness and for commencement of operations under the pilot phase. Subsequently, they will commercially launch their operations after obtaining SBP’s approval.

SBP launches licensing and regulatory framework for digital banks

SBP has issued NOC to Easy Paisa DB (Telenor Pakistan B.V & Ali Pay Holding Ltd.), (ii) Hugo Bank (Getz Bros & Co., Atlas Consolidated Pte. Ltd. and M & P Pakistan Pvt. Ltd.), (iii) KT Bank (Kuda Technologies Ltd., Fatima Fertilizer Ltd. and City School Pvt. Ltd.), (iv) Mashreq Bank (Mashreq Bank UAE) and (v) Raqami (Kuwait Investment Authority through-PKIC and Enertech Holding Co).

In January 2022, SBP introduced a Licensing and Regulatory Framework for Digital Banks in line with international best practices and decided to issue up to five digital banks’ licenses. The Framework was the first step towards introducing full-fledged digital banks in Pakistan. The digital banks are expected to provide all the banking services through digital means without any need for their customers to visit the bank branches, physically.

Copyright Business Recorder, 2023