Digital Banks Are Coming: What Changes for the Average Customer

Five new digital banks got the green light from Bangladesh Bank in September. None of them has a single branch. Here is what that actually means for your money, your loans and your daily banking.

For most people in Dhaka, a bank still means a building. You queue at a counter, fill a deposit slip, and wait for a stamp. That picture is about to change.

On 24 September 2026, the Bangladesh Bank board gave initial approval, called a Letter of Intent, to five proposed digital banks: bKash Digital Bank, Nova Digital Bank (from Banglalink’s parent VEON and Square Group), Boost Digital Bank (from Robi’s parent Axiata), DK Digital Bank (backed by Bhutan’s DK Bank) and Kori Digital Bank (The Daily Star). Nagad Digital Bank got a full licence in 2024, but it was suspended that August; central bank officials now say it can start if it meets the conditions.

A digital bank is a real, licensed bank. It can take deposits and give loans. The difference is that everything happens on your phone or computer. There are no branches, no counters and no bank-owned ATMs.

This Dhaka Debates explainer covers the rules, the players, what will change for an ordinary customer, and the questions nobody has fully answered yet.

The rules: what a digital bank can and cannot do

Bangladesh Bank first wrote the digital bank rulebook on 14 June 2023. It tightened the rules in August 2025, before inviting the new round of applications (TBS). Here is the short version.

A digital bank is a full bank, not a wallet. It is licensed under the Bank Company Act, 1991, the same law that covers City Bank or Dutch-Bangla Bank. That means it can take savings deposits and give loans, which bKash and Nagad cannot do today.

What it cannot have:

• No branches or sub-branches. Only one head office.
• No over-the-counter service. You cannot walk in and deposit cash.
• No ATMs, cash deposit machines or agents of its own.
• No plastic debit or credit cards. Only virtual cards and QR codes (Jagonews24).

What it cannot lend for:

• No letters of credit (LCs) for import or export.
• No term loans to medium or large industries.

In practice, its lending is meant for small loans: individuals, freelancers, micro and small businesses, and people who have never had a bank account.

How you will still get cash. A digital bank can use other banks’ ATMs, cash machines and agents, and the networks of mobile financial services, under Bangladesh Bank’s rules (Dhaka Tribune). So you will not be cut off from cash, but you will be using someone else’s machine.

Tougher rules for owners. The 2025 revision raised the minimum paid-up capital from Tk 125 crore to Tk 300 crore. Shell companies and people facing loan default cases cannot be sponsors. Existing banks and finance companies cannot sponsor one either. Every digital bank must list on the stock market within five years of getting its licence.

Who is getting a licence

Twelve groups applied in the latest round. The Bangladesh Bank board, chaired by Governor Md Mostaqur Rahman, picked four new names and renewed one old one on 24 September 2026 (Bonik Barta).

Digital bank	Who is behind it	Status (Oct 2026)
bKash Digital Bank	Shareholders of bKash, the MFS owned by BRAC Bank	Letter of Intent
Nova Digital Bank	VEON (Banglalink’s parent) and Square Group	Letter of Intent
Boost Digital Bank	Axiata (Robi’s parent)	Letter of Intent
DK Digital Bank	Bhutan’s DK Bank	Letter of Intent
Kori Digital Bank	Sponsors include ACI	Letter of Intent renewed, first issued in 2023
Nagad Digital Bank	Nagad’s sponsors	Full licence from June 2024, suspended in August 2024

A Letter of Intent is not a licence. It lists the conditions a company must meet, such as building its technology and raising the Tk 300 crore capital, before it can open for business (The Daily Star). That usually takes months.

So when can you open an account? No launch dates have been announced. History is a warning here. Kori got its first Letter of Intent in October 2023 and still has not opened. VEON itself says further regulatory and operational steps are needed before its bank can start (Developing Telecoms).

The big shift this time is who is involved. For the first time, mobile operators Banglalink and Robi are being allowed into banking. bKash, which already serves tens of millions of people, wants to turn its wallet users into bank customers.

What changes for the average customer

Let’s take a typical person: a garment supervisor in Gazipur, a freelancer in Mirpur, or a shop owner in Rangpur. Here is what a digital bank could change for them, and what it won’t.

1. Opening an account without visiting anyone. You will open the account on your phone using your NID and a selfie check (e-KYC). No forms, no introducer, no trip to a branch during office hours.

2. Banking at any hour. Digital banks are meant to run 24 hours a day, seven days a week (The Daily Star). Transfers, bill payments and balance checks will not wait for Sunday morning.

3. Real savings, not just a wallet. Today, money in a bKash or Nagad wallet earns almost nothing and has strict limits. A digital bank account is a proper bank deposit. Sponsors argue that lower costs should allow better savings rates, but none of the new banks has published rates yet.

4. Small loans without collateral, maybe. This is the biggest promise. Many small traders still borrow from local moneylenders at very high interest because banks ask for land papers and trade licences. Digital banks plan to judge borrowers by their transaction history instead. Whether these loans will be cheap is still unknown.

5. Cards on your phone, not in your wallet. You will get a virtual card for online shopping and QR codes for paying at shops. If you want to withdraw cash, you will use a partner bank’s ATM or an agent, which may carry a fee.

6. Who this suits less. If you need an LC for your import business, a large factory loan, or you like sorting problems face to face, a digital bank is not built for you. Customer service will run through apps and call centres, not desks.

One honest caution from Jagonews24’s explainer: lower running costs do not automatically mean lower fees or cheaper loans for customers (Jagonews24). That depends on competition.

Risks and questions nobody has fully answered

New banks bring new choices. They also bring new risks, especially in a banking sector still recovering from years of bad loans and scandals.

Is my money safe if a digital bank fails? Digital banks are licensed under the Bank Company Act, so they are expected to sit under the same deposit protection scheme as other banks. Parliament passed the Deposit Protection Bill, 2026, which guarantees up to Tk 2 lakh per depositor if a bank is liquidated (Insurance News BD). Anything above that is not guaranteed. If you plan to keep more than Tk 2 lakh, think about spreading it across banks.

Can the licensing be trusted? The first round had problems. A World Bank Group report criticised the 2023 licences to Nagad and Kori, saying the process lacked transparency and favoured politically connected interests (TBS). Nagad’s licence was then suspended over doubts about its foreign sponsors. In February 2026, Bangladesh Bank’s own officers protested a planned approval as too hasty, and the decision was deferred (The Daily Star). The tougher 2025 rules aim to stop this happening again.

Will easy loans become a debt trap? Policy Research Institute economist Ashikur Rahman welcomed the move but warned that digital banks must avoid aggressive lending (The Daily Star). A loan that arrives in two taps is also easy to take without thinking.

Fraud and phishing. With no branch to visit, scammers will pose as “digital bank officers” on phone calls and Facebook. A real bank will never ask for your OTP or PIN.

Is this even needed? Not everyone is convinced. Former Chittagong University economics professor Muinul Islam questioned how much the new banks will really do for financial inclusion when traditional banks are going digital too. Supporters answer that existing banks have failed to reach most people: about 75 per cent of bank loans go to just 1 to 2 per cent of accounts, and Dhaka alone holds almost 60 per cent of loans.

What about villages? About 54 per cent of the population used MFS by 2024, with strong growth in rural areas (The Daily Star). But a digital bank needs a smartphone, data and some confidence with apps. Older people and those with basic phones may be left behind.

Digital bank vs bKash vs a regular bank

The most common confusion is the difference between a digital bank and the bKash or Nagad app already on your phone. This table puts the three side by side, based on Bangladesh Bank’s rules.

Feature	Regular bank	Digital bank	MFS (bKash, Nagad)
Branches	Yes	No, head office only	No, agents only
Open account from phone	Some banks	Yes, always	Yes
Savings deposits	Yes	Yes	Wallet balance only
Loans	All types	Small loans; no LCs or big industry loans	Small nano loans through partner banks
Cards	Plastic and virtual	Virtual only	Virtual or none
Cash withdrawal	Own ATMs and branches	Partner ATMs and agents	Own agents
Hours	Branch hours, apps 24/7	24/7	24/7
Deposit protection	Up to Tk 2 lakh	Expected up to Tk 2 lakh	Not a bank deposit

The simple way to think about it: a digital bank tries to give you the full powers of a bank with the convenience of an MFS app.

What you can do now

• Don’t rush. No new digital bank is open yet. Any app or page asking you to “pre-register” and pay a fee is almost certainly a scam.
• Keep your NID details up to date. Account opening will rely on e-KYC, so your NID and mobile number should match.
• Compare before you switch. When the banks launch, check savings rates, loan rates, ATM fees and customer reviews before moving money.
• Stay within the safety limit. Deposit protection covers up to Tk 2 lakh per depositor per bank.

This report is for public information only and is not financial advice.

Frequently asked questions

What is a digital bank?

A licensed bank that works only through an app or website. It has no branches and no counters, but it can hold deposits and give loans.

Is a digital bank the same as bKash or Nagad?

No. bKash and Nagad are mobile wallets. A digital bank is a full bank with savings accounts and loans. bKash is now trying to set up its own digital bank.

When will digital banks launch in Bangladesh?

No date has been announced. The five new approvals are Letters of Intent, so each company must still meet conditions and get a final licence.

Can I withdraw cash from a digital bank?

Yes, through partner banks’ ATMs, agents or MFS networks. The digital bank will not have its own ATMs.

Will I get a debit card?

You will get a virtual card and QR payments. Physical plastic cards are not allowed under the rules.

Is my money insured?

Digital banks are licensed under the same banking law as other banks and are expected to be covered by the Tk 2 lakh deposit protection scheme.

Key words explained

Word	Simple meaning
Digital bank	A licensed bank with no branches that works fully online
Letter of Intent (LoI)	First-stage approval; the company must meet conditions before getting a final licence
MFS	Mobile financial services, such as bKash, Nagad and Rocket
e-KYC	Checking your identity online using your NID and a photo
Virtual card	A debit card that exists only in your app, used for online and QR payments
Letter of credit (LC)	A bank guarantee used in import and export, not allowed for digital banks
Paid-up capital	Money the owners must put into the bank before it opens; Tk 300 crore for digital banks
Deposit protection	Government-backed guarantee that returns up to Tk 2 lakh if a bank collapses

How we reported this

This report draws on Bangladesh Bank’s digital bank guidelines of 2023 and their 2025 revision, statements by the Bangladesh Bank spokesperson, board decisions reported by national newspapers, company announcements from VEON, and the Deposit Protection Bill, 2026. We checked each figure against at least one published source and linked it. Where something is not yet known, such as launch dates or interest rates, we say so. Facts are correct as of 31 October 2026.