The most recent update in the digital banking sector shows that Pakistan is growing digitally at a fast pace. The State Bank of Pakistan (SBP) has issued the licencing and regulatory framework for setting up digital banks. Over time, there has been the growth of digital insurance, digital economy, paperless payments, cryptocurrency, and other digital forms.
This licencing and regulatory framework will play a major role in the growth of the digital economy and help set up digital banks as separate entities in Pakistan. Financial inclusion has always been a major issue in the country, and this framework is likely to lead to affordable digital financial services.
Under the framework, the SBP is set to grant two types of digital banking licences according to certain terms. The first one is digital retail banks that will focus on retail customers and the other is digital full banks that will focus on retail customers, businesses and corporate entities. Through the licences, up to five digital bank licences will be issued to attract different financial players who should have a strong value proposition, powerful technological infrastructure, financial strength, skills, technical expertise, and effective risk management strategies.
Digital banks will offer financial products and services through remarkable digital platforms and electronic channels. The major objective of the framework will be to promote financial inclusion, provide easy credit access and affordable digital...
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