The application deadline for digital banking licenses was March 31, and the State Bank of Pakistan (SBP) says 20 applications were received from foreign and domestic banks, including many Fintech startups.
Rewind: In January, the State Bank of Pakistan announced a license and regulatory framework for digital banks.
It outlined details for setting up digital banks as a separate category in the country.
It is another initiative by the State Bank toward digitalization, and it seeks to increase financial inclusion in the country.
In essence, a digital bank allows you to open an account, deposit money, and borrow money without going to a physical branch.
SBP invited applications from applicants with:
- strong value proposition
- robust technological infrastructure
- sufficient financial strength
- technical expertise
- effective risk management culture.
Fast forward: SBP claims that it received an overwhelming response in a recent statement as it received 20 applications for the digital banking license.
No information related to the entities or countries interested in the digital banking license was provided.
The website still shows that applications are open (they’re not).
You should know: A few days back, Tania Aidrus, the former special advisor to the prime minister, tweeted that Kleiner Perkins and Sequoia Capital will be backing her new digital banking startup called D-Bank.
She is one of the top contenders for a license in digital banking. And I don’t need to tell you about Kleiner Perkins and Sequoia Capital.
But I will.
They are both prestigious silicon valley VC firms that have backed Amazon, Google, Twitter (Kleiner), Apple, Cisco, LinkedIn, and WhatsApp (Sequoia).
Zoom Out: Despite COVID-19 and other problems, local and international players have shown overwhelming interest in SBP’s digital banking license.
Ultimately, consumers will benefit from this because it will lead to better coverage, better service, and a documented economy.
