Economic Reporter :
Nagad, a mobile financial service (MFS) operator of a private fintech firm- Third Wave Technology is facing tough time to get regulatory permission as the government has no stake in it and no bank has major share in it.
Nagad, which branded itself as a state-run MFS provider with stake of Bangladesh Post Office- is yet to obtain central bank permission as it is yet to form a subsidiary of a scheduled bank to fulfill the regulatory requirements as per the Bangladesh Bank’s MFS guidelines.
At present, the MFS operator is running its operations with a temporary licence from Bangladesh Bank, which deadline was March 15 last. The Department of Post Office, however, has submitted an application to the Bangladesh Bank for further extension of the BB’s temporary approval or no objection certificate.
Under the existing regulations, an MFS operator must be a subsidiary of a bank. Except Nagad, all 15 MFS operators, stand on a bank-led model and now the global role model in MFS markets.
Nagad is running its operations by TWT, a fintech company in the name of the service of Bangladesh Post Office without partnership with any scheduled bank. Sigma Group has majority investment in Nagad, which is not acceptable to the Bangladesh Bank for availing a licence.
The concern is that Bangladesh Post Office or even the government has no stake in this fintech and also has no control over its operations, which is too risky.
