KARACHI: The State Bank of Pakistan (SBP) said on Wednesday it had granted in-principal approval (IPA) for establishing five digital retails banks (DRBs) in a bid to “foster innovation, financial inclusion and availability of affordable digital financial services.”
SBP issued no-objection certificates to five successful applicants for establishing digital banks in Pakistan in January 2023. After the fulfillment of necessary requirements, the entities have now been granted in-principal approval to prepare themselves operationally to launch digital financial services.
The five digital retail banks are HugoBank Limited, KT Bank Pakistan Limited, Mashreq Bank Pakistan Limited, Raqqami Islamic Digital Bank Limited and Telenor Microfinance Bank Limited.
A digital bank operates online and provides its customers the services that were previously available only at a bank branch. DRBs usually cater to the retail segment like individual customers and small and medium businesses.
“Governor SBP highlighted the significance of the initiative of introducing DRBs in the country, its profound benefits to the financial system and some of the key challenges faced by such a genre of financial players,” the SBP said, quoting Jameel Ahmed, who also spoke about other important regulatory initiatives in support of building a digital financial ecosystem and assured that the SBP was fully committed to supporting various stakeholders for a “bright, innovative, and digitally empowered future of banking in Pakistan.”
“Jameel Ahmed also shared his expectations that post operational commencement, digital banks will help developing a digital eco-system, foster a new set of customer experience, provide affordable digital financial services including credit access to unserved and underserved segments of the society,” the central bank said.
The in-principal approvals will enable the proposed DRBs to proceed further with achieving operational readiness in all functions, including governance, risk management, capital requirements, compliance and audit, consumer protection, business continuity, cybersecurity, product development, deployment of technological infrastructure, formulation of relevant policies, processes and procedures.
Earlier this year, SBP issued no-objection certificates to the proposed DRBs, allowing them to incorporate as a Public Limited Company with the Securities and Exchange Commission of Pakistan (SECP). The five institutions were selected after a thorough and rigorous evaluation process based on a comprehensive set of parameters including fitness and propriety, experience and financial strength; business plan; implementation plan; funding and capital plan; IT and cybersecurity strategy and outsourcing arrangements.
Upon attaining operational readiness, the five institutions would finally be required to seek approval of the SBP for the commencement of operations.
Pakistan’s central bank approves five digital retail banks
https://arab.news/9cdz7
Pakistan’s central bank approves five digital retail banks
- State Bank issued no-objection certificates to five applicants for establishing digital banks in Pakistan in January 2023
- HugoBank, KT Bank Pakistan, Mashreq Bank Pakistan, Raqqami Islamic Digital Bank, Telenor Microfinance Bank approved
World Bank president in Pakistan to discuss development projects, policy issues
- Pakistan, World Bank are currently gearing up to implement a 10-year partnership framework to grant $20 billion loans to the cash-strapped nation
- World Bank President Ajay Banga will hold meetings with Pakistan Prime Minister Shehbaz Sharif and other senior officials during the high-level visit
ISLAMABAD: World Bank President Ajay Banga has arrived in Pakistan to hold talks with senior government officials on development projects and key policy issues, Pakistani state media reported on Sunday, as Islamabad seeks multilateral support to stabilize economy and accelerate growth.
The visit comes at a time when Pakistan and the World Bank are gearing up to implement a 10-year Country Partnership Framework (CPF) to grant $20 billion in loans to the cash-strapped nation.
The World Bank’s lending for Pakistan, due to start this year, will focus on education quality, child stunting, climate resilience, energy efficiency, inclusive development and private investment.
"World Bank President Ajay Banga arrives in Pakistan for a high-level visit," the state-run Pakistan TV Digital reported on Sunday. "During his stay, he will meet Prime Minister Shehbaz Sharif and other senior officials to discuss economic reforms, development projects, and key policy issues."
Pakistan, which nearly defaulted on its foreign debt obligations in 2023, is currently making efforts to stabilize its economy under a $7 billion International Monetary Fund (IMF) program.
Besides efforts to boost trade and foreign investment, Islamabad has been seeking support from multilateral financial institutions to ensure economic recovery.
“This partnership fosters a unified and focused vision for your county around six outcomes with clear, tangible and ambitious 10-year targets,” Martin Raiser, the World Bank vice president for South Asia, had said at the launch of the CPF in Jan. last year.
“We hope that the CPF will serve as an anchor for this engagement to keep us on the right track. Partnerships will equally be critical. More resources will be needed to have the impact at the scale that we wish to achieve and this will require close collaboration with all the development partners.”
In Dec., the World Bank said it had approved $700 million in financing for Pakistan under a multi-year initiative aimed at supporting the country's macroeconomic stability and service delivery.
It followed a $47.9 million World Bank grant in August last year to improve primary education in Pakistan's most populous Punjab province.
