KARACHI: State Bank of Pakistan (SBP) and Karandaaz has signed an agreement to support in creating an enabling environment based on international best practices for digital banks.
“Karandaaz will provide technical assistance to the SBP for formulating legal and regulatory framework including licensing criteria for digital banks in Pakistan,” said a statement issued by the central bank.
The agreement was signed in Islamabad by Syed Irfan Ali, Executive Director, State Bank of Pakistan and CEO Karandaaz, Ali Sarfraz.
Riaz Riazuddin, Deputy Governor State Bank of Pakistan, dignitaries from SAARC countries currently in Islamabad to attend the SAARC Finance Forum 2018, and other senior officials witnessed the signing ceremony.
Improving the efficiency, effectiveness and fairness of the banking system through strengthening and streamlining the regulatory and supervisory framework are amongst the six main goals of State Bank of Pakistan’s Vision 2020.
The banking sector and market players at present need regulatory direction to offer services as standalone digital banks. State Bank of Pakistan is already working to introduce a separate category of banking services through promulgation of a framework for digital banks in Pakistan.
The output of this engagement will be comprehensive recommendations for formulation of the regulatory framework, including licensing criteria and any amendments required in existing legal frameworks for the advent of digital banks in Pakistan.
Speaking at the occasion, Syed Irfan Ali, Executive Director State Bank said, “In Pakistan, more than 90 percent of the population has access to most affordable ICT services in the world. The consumers’ use of electronic payments in Pakistan has grown significantly in recent years. This trend will accelerate in coming years due to the vision of State Bank of Pakistan on provision of digital financial services, especially to financially excluded segment of population.”
While speaking at the occasion Ali Sarfraz, CEO Karandaaz said, “The technical assistance will include extensive review of existing laws, rules & regulations and international best practices on regulatory frameworks for digital banks. Extensive consultations will be held with the industry players for developing a robust and conducive regulatory regime for digital banks.”
