SBP awards first DRB licence to easypaisa digital bank

KARACHI: The State Bank of Pakistan (SBP) granted the first digital retail bank (DRB) licence to easypaisa Bank Limited (formerly Telenor Microfinance Bank Limited), allowing it to commence commercial operations, a statement said on Tuesday.

“The DRB licence to easypaisa Bank Limited is expected to promote innovation, enhance financial inclusion and ensure the availability of accessible and affordable digital financial services,” the SBP said.

Delivering the keynote address at a licensing ceremony, Governor SBP Jameel Ahmad added the SBP’s pivotal role in creating the environment for digital banking in Pakistan and promoting the establishment of digital banks via a structured licensing process.

He urged easypaisa Bank to draw inspiration from its sponsor, Ant Group, by prioritising the digital transformation of small and medium enterprises (SMEs) in Pakistan.

Ahmad also highlighted the critical importance of achieving licensing milestones and encouraged digital banks to innovate and design customer-centric solutions tailored to the needs of individuals, micro, small and medium enterprises (MSMEs) and other underserved segments. He emphasised that this focus would be instrumental in fostering financial inclusion and driving economic growth.

He stressed the importance of addressing challenges associated with rapid technological advancements. He highlighted two critical areas of digital literacy of customers and cyber security measures to protect customer trust and ensure the integrity of the financial system. Ahmad also expressed his confidence that, with the issuance of this licence, easypaisa Bank will prioritise the development of innovative, customer-focused and affordable digital financial solutions, particularly for underserved and unserved segments of society. He emphasised that such efforts will play a pivotal role in advancing the financial inclusion and digitalisation objectives.

In January 2023, the SBP issued no objection certificates (NoCs) to five successful applicants: HugoBank Limited, KT Bank Pakistan Limited, Mashreq Bank Pakistan Limited, Raqami Islamic Digital Bank Limited and easypaisa Bank Limited. These entities were selected following a rigorous evaluation process that assessed key criteria, including governance and fitness, industry expertise, financial capacity, business strategies, implementation frameworks, funding plans, and IT and cybersecurity infrastructure.

In September 2023, these banks received in-principle approval to prepare for operational readiness.

“From being Pakistan’s first branchless mobile money transfer solution to becoming Pakistan’s first digital bank to launch commercial operations, easypaisa’s transition marks a transformative leap in financial services, enabling customers to access comprehensive banking solutions entirely

By eliminating the need for traditional branch visits, the bank represents a significant paradigm shift in digital financial accessibility and innovation.

With 50 million registered users representing one in four Pakistani adults, a robust 31 per cent women user base, and 2.7 billion transactions processed in 2024 valued at Rs9.5 trillion (approximately 9.0 per cent of Pakistan’s GDP), easypaisa has established itself as a pivotal player in the country’s financial ecosystem.

According to the bank, it is poised to deliver a robust, secure and seamless digital banking experience to millions of Pakistanis. As a pioneer in best-in-class digital financial solutions, the bank is introducing many products that are firsts in Pakistan, such as digital term deposits and digital lending options that are available on phone, along with a diverse range of innovative services, from digital current and savings accounts, digital wealth management tools, international remittances, to credit and debit cards -- all accessible digitally. These groundbreaking offerings aim to expand access to convenient digital banking services for a broader audience.

Irfan Wahab Khan, board chair of easypaisa digital bank, said, “Looking ahead, we remain steadfast in our commitment to making a meaningful impact on Pakistan’s digital economy, advancing financial inclusion, and scaling digital financial services to empower millions of Pakistanis.”

Douglas Feagin, director on the board of easypaisa digital bank, president of Ant International and senior vice president at Ant Group, stated: “easypaisa’s evolution into a digital bank marks a significant milestone in Pakistan’s financial services landscape. Ant Group looks forward to further supporting this transformative journey and helping to empower millions of Pakistanis, driving greater financial inclusion and economic progress across the country.”

Jahanzeb Khan, CEO and president of easypaisa digital bank, added: “Our commitment remains unwavering, to continue pioneering innovative digital financial solutions that redefine banking in Pakistan.”