In an effort to promote innovation, financial inclusion, and the availability of affordable digital financial services, the State Bank of Pakistan (SBP) on Wednesday gave in-principle approval (IPA) for the establishment of five digital retail banks.
In a ceremony held at the SBP Museum Building, Governor SBP Jameel Ahmad presented IPAs to the five proposed digital banks, including HugoBank Limited, KT Bank Pakistan Limited, Mashreq Bank Pakistan Limited, Raqami Islamic Digital Bank Limited, and Telenor Microfinance Bank Limited.
Participants included CEOs of existing banks, payment system operators, payment system providers, electronic money institutions (EMIs), fintech companies, and sponsors of proposed DRBs.
It is important to note that in January 2023, the central bank issued NoCs to five successful applicants for the creation of digital banks in Pakistan. Now that the requirements have been met, these entities have been given in-principle approval to get ready to launch the digital financial services.
These institutions will need to request SBP approval before they can start operating once they have reached operational readiness.
The proposed DRBs were given a “No Objection Certificate (NOC)” by SBP earlier this year, enabling them to register with the Securities and Exchange Commission of Pakistan (SECP) as a public limited company.
After a thorough and rigorous evaluation process, these institutions were chosen based on a wide range of criteria, including fit and propriety, experience, and financial strength. Other criteria considered were business plans, implementation plans, funding and capital plans, IT and cybersecurity strategies, and outsourcing agreements.
