Bangladesh Bank is poised to issue new digital banking licenses in an effort to accelerate the country’s fintech landscape and draw fresh investment, according to reports in media.

A conclusive decision is anticipated at the central bank’s upcoming board meeting scheduled for August 27.

The planned move comes against the backdrop of stalled progress by the first two licensed digital banks—Nagad Digital Bank PLC and Kori Digital Bank PLC—both of which were approved in 2023 but have yet to commence operations.

That year, the central bank received 52 applications, of which five firms were granted Letters of Intent. However, limited advancements have been made since, raising concerns over the efficacy and direction of the licensing process.

In a bid to restore credibility and transparency, the Bangladesh Bank is expected to restart the licensing round with more stringent and clearly defined criteria, thereby moving away from the earlier selection process that had been criticised for perceived political influence.

As part of the reassessment, regulators are also conducting a broader review of the country’s digital banking framework, taking into account recent liquidity pressures faced by traditional banks. Officials suggest that any new licensing will be aligned with enhanced safeguards to protect depositors and maintain financial stability.

Formal invitations for new digital bank applications are expected to be announced shortly.

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