Bangladesh takes major step toward digital-only banking
Five new branchless banks move closer to launch as Bangladesh pushes financial services online and seeks wider access beyond conventional banking
DHAKA, Bangladesh (MNTV) — Bangladesh has taken a major step toward digital-only banking, clearing five new branchless lenders as the South Asian country seeks to move more financial services online and expand access beyond the reach of conventional bank networks.
The latest approvals could bring some of Bangladesh’s biggest mobile-money and telecommunications companies directly into banking, potentially allowing millions of customers to access financial services through smartphones without visiting a physical branch.
According to The Daily Star, Bangladesh Bank issued letters of intent Thursday to five proposed digital banks, allowing them to build the infrastructure required before receiving final licences and beginning operations.
Among them are bKash Digital Bank, backed by Bangladesh’s dominant mobile financial service provider, and digital banks promoted by telecom operators Banglalink and Robi Axiata. Two other ventures involve Bangladeshi technology and foreign banking interests.
The model represents a significant departure from conventional banking in Bangladesh. Digital banks will have no customer-facing branches and will instead provide banking services through mobile applications and websites, maintaining only a headquarters.
Bangladesh introduced its digital banking framework in 2023 as part of efforts to make financial services cheaper and more accessible, particularly for small entrepreneurs and communities that remain poorly served by conventional banks.
Each digital bank is required to maintain at least $25 million in paid-up capital and meet the central bank’s technology, security and operational requirements before opening to customers.
The shift builds on Bangladesh’s rapid adoption of mobile financial services, which have made phone-based money transfers and payments commonplace even among people without easy access to traditional bank branches. Digital banks would take that transition further by moving a broader range of banking services onto online platforms.
Bangladesh Bank also sees the model as part of the country’s push toward a less cash-dependent economy.
Demand for digital banking licences has been strong. Twelve entities applied in the latest round, including telecom operators, mobile financial service providers, commercial banks and major business groups, several with foreign partners.
The central bank had previously selected two digital-bank proposals in 2023 after receiving 52 applications, although one of those licensing processes was later placed under review.
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