Chinese consortium seeks digital banking licence in BD

A group of Chinese nationals, in collaboration with Bangladeshi partners, has applied for a digital bank licence in Bangladesh, according to documents of the Chinese Embassy in Dhaka.
The consortium submitted the application to the Bangladesh Bank under the name China Bangla Bank Plc.
As a joint venture, China Bangla Bank Plc has pledged an initial investment of approximately $10 million, with a further commitment of $200 million over five years, show the papers.
The embassy expects the venture to generate over 7,000 jobs in Bangladesh.
The infusion of Chinese technical expertise and technology investment will indirectly enhance financial inclusion for marginalised communities. This aligns with the bank's goal of extending banking services to over 75 million under-served individuals, according to the documents.
The China Council for the Promotion of International Trade Guangdong Committee (CCPIT Guangdong Committee) recently contacted the Economic and Commercial Office of the Chinese Embassy in Bangladesh to initiate communication with relevant Bangladeshi agencies regarding the application.
A high-powered team of the Bangladesh Bank previously visited China, where the issue of digital banking operations by Chinese entrepreneurs was discussed, a source said.
When contacted, Bangladesh China Chamber of Commerce and Industry Secretary General Al Mamun Mridha said Bangladesh has made significant strides in digital adoption in recent years. For this, there is no alternative to digital banking.
He added that digital banking offers greater convenience, security and ease of transferring funds compared to existing banking services.
Mr. Mridha claimed that China's experience in digital technologies would be beneficial for Bangladesh's digital banking sector if Chinese investors were involved.
The Bangladesh Bank has already granted initial approval to eight digital banks to meet customer needs in the digital age and serve the unbanked population.
Unlike traditional banks, they will operate solely online with a central headquarters and no physical branches.
Digital banking allows customers to conduct banking transactions and access services remotely, via a website or mobile app, without needing to visit a physical branch.
Two new digital banks, Nagad Digital Bank PLC and Kori Digital Bank PLC, have already received letters of intent (LoI) and are preparing to launch operations soon.
The central bank will monitor their performance over the next six months, a central bank source said.
The letter of intent outlines a timeframe for the digital banks to develop their infrastructure under central bank supervision.
Three other banks -- Smart Digital Bank PLC, North East Digital Bank PLC and Japan-Bangladesh Digital Bank PLC -- will receive their letters of intent after six months, based on the performance of the initial two.
The Bangladesh Bank has also approved three existing banks to offer digital banking services: BRAC Bank with bKash, DG-10, a consortium of 10 private commercial banks, and Digital Bank PLC led by Bank Asia.

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