CBK governor issues guidelines for digital banks

Central Bank of Kuwait (CBK) said in a statement that it issued guidelines specifying requirements for establishing digital banks. This falls within CBK’s overall effort to utilize the latest advancements to bolster financial stability, encourage innovation, and meet future economic needs.

Central Bank Governor Dr Mohammad Y Al-Hashel stressed that guaranteeing the smooth operation of the banking business is among top CBK priorities, as mandated by the relevant law.

The governor said that digital banks function within three main models; as a unit within a traditional bank, or as a partnership between such bank and a digital institution where the bank handles core banking operations while the second party handles relations with customers, trademark, and other areas of operation and service. The third model is establishment of a standalone digital bank.

Dr Al-Hashel stated that CBK issued comprehensive guidelines for establishing new digital banks, and has opened the application process. The CBK will receive and collect all completed application forms and documents as of the date of issue of the guidelines until 30/6/2022.

During said period, the CBK shall reply to all queries it receives. The applications will be evaluated against specific objective criteria over a period of six months, and initial approval shall be granted by year-end.