Mobile financial service (MFS) provider Nagad gets more three months to create venture with commercial banks in line with the Bangladesh Bank directives.
Nagad sought an extension of the interim licensing period for the fourth time to complete the process which will expire on June 30, according to BB directives issued on Tuesday.
The prime condition of the BB’s temporary NOC was that Nagad must operate its business under a subsidiary company of a bank as the regulation only allows banks to form subsidiary to provide MFS services.
Nagad has been trying for last six months to negotiate with state-run Sonali Bank and couple of commercial banks to comply with the Bangladesh Bank regulation which mentioned that none MFS can operate without bank affiliation.
State-run Sonali Bank board of directors refused the Nagad proposal of 33 percent share while Bangladesh Post Office will hold 34 percent and the remained share will be with Nagad Limited operated by Sigma Group, according to the source.
Tanvir A Mishuk, managing director of Nagad, said the overall work flow has slowed down due to the Covid 19 pandemic, that has also slowed the licensing process.
“To keep our service uninterrupted, the time has been extended for 3 months,” he told a state-run news agency.
Nagad is now the second-largest MFS provider in Bangladesh while it has enhanced the market competition within two years of its inception. More than Tk 7 billion is being transacted a day through Nagad which has some 52 million users.
More than 10 million people transact more than Tk 1 billion day which ultimately keeps the economy vibrant with a positive impact on the rural areas.