Eight digital banks on Sunday received the initial approval from Bangladesh Bank.
Two of the new digital banks -- Nagad Digital Bank PLC and Kori Digital Bank PLC -- got letter of intent (LoI) on the day.
The central bank will monitor their different indicators over the next six months.
The letter of intent contains a timeframe for the digital banks to prepare their infrastructure under the gaze of the central bank.
Three other banks -- Smart Digital Bank PLC, North East Digital Bank PLC, and Japan-Bangladesh Digital Bank PLC -- will be given letter of intent after six months by overseeing the performance of the above-mentioned two that got the LoI on the first day.
The central bank also gave its nod to three existing banks for conducting digital banking in the country.
They are Brac Bank with bKash, DG-10, a group of 10 private commercial banks including City Bank, Eastern Bank, Mercantile Bank, Midland Bank, NCC Bank, MTB, Prime Bank, Pubali Bank, Trust, and Dutch-Bangla Bank.
Digital Bank PLC is led by Bank Asia.
The Bangladesh Bank board led by its Governor Abdur Rouf Talukder gave the nod in a board meeting held at the central bank on the day.
Digital banking is banking activity conducted entirely online, either through a website or mobile app.
It lets customers perform banking transactions and access banking services remotely, without having to visit a physical branch. They will each have a headquarters only, and no branch.
Earlier, three separate committees had shortlisted 9 applications out of 52. The board members excluded one application that was insurance company-led.
Spokesperson for Bangladesh Bank, Md Mezbaul Hauqe briefed the media on the meeting outcome.
He said the insurance-led application was excluded because insurance business and banking activity are different.
The Bangladesh Bank will prepare a separate guideline (standard operating procedure) for the existing banks which got the digital bank permissions on the day. They will do their business through digital bank windows. They need no new licence as they already have licences, he also said.
The 52 applications came from either individuals or groups of a total of around 500 companies from diverse sectors like commercial banks, mobile financial-service providers, food delivery and ride-sharing platforms, IT service providers, and pharmaceutical companies.
The deadline for applying for the digital bank licensing ended on August 17, after it was extended by 16 days.
The digital banks need Tk125 crore in paid-up capital each, which is lower than the Tk500 crore for commercial banks.
