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.
For all latest news, follow The Daily Star's Google News channel. 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.
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