Nagad gets BB’s primary nod to run as NBFI

Nagad Finance PLC has received the primary approval from the Bangladesh Bank to operate as a non-banking finance institution (NBFI).

The approval came in the central bank’s 424th board meeting on Tuesday.

“The BB has decided to grant a letter of intent (LOI) for the proposed NBFI tagging some conditions,” BB spokesperson Md Serajul Islam told to The Business Post.

However, he was reluctant to disclose the conditions.

Islam said that bank or NBFI generally gets final licence from the BB after fulfilling the conditions set by the central bank.

“If Nagad Finance PLC meets all the criteria required for receiving the licence, the final approval will be given in three months,” he said.

Summit Group of Companies Vice Chairman Muhammad Farid Khan applied for the proposed NBFI as its chairman.

“Nagad Ltd (previously known as Third Wave Technologies Ltd) wants to run Mobile Financial Services (MFS) business under the proposed NBFI and this may be the reason for obtaining a NBFI licence,” said a BB high official requesting not to be named.

On February 15 of this year, the central bank allowed non-bank financial institutions and government entities to operate MFS. Previously, only banks were allowed to operate MFS.

The BB’s revised regulation prompted some investors of Nagad Ltd to apply to the BB for a NBFI license.

Nagad Ltd applied to the central bank’s department of Financial Institutions and Market on March 14 of this year for the NBFI licence.