Raqami Bank becomes Pakistan's first licensed digital bank

In a landmark development for Pakistan's banking sector, Raqami Islamic Digital Bank Limited has officially become the country's first fully licensed digital bank.

It was declared a scheduled bank by the State Bank of Pakistan (SBP) on Monday.

In a press release, the SBP said the designation was granted under Section 37(2)(a) of the SBP Act 1956.

Raqami has committed to investing USD 100 million over the next few years to build its digital infrastructure, develop innovative Islamic banking products, and expand its technological capabilities.

This substantial investment underscores the bank's ambition to revolutionize Pakistan's banking landscape and achieve significant financial inclusion targets.

The investment is expected to cover advanced technology platforms, cybersecurity infrastructure, customer acquisition, talent development, and the creation of AI-driven banking solutions tailored to Pakistani consumers' needs.

What is a digital bank?

Unlike traditional banks that operate through physical branches, digital banks function entirely online through mobile apps and web platforms.

Customers can open accounts, conduct transactions, apply for loans, and access all banking services without ever visiting a brick-and-mortar location.

Digital banks typically offer lower fees and higher interest rates on deposits due to reduced operational costs from not maintaining expensive branch networks. They leverage technology like artificial intelligence, data analytics, and automated processes to provide 24/7 banking services with faster approvals and personalized financial products.

Raqami, being an Islamic digital bank, will operate according to Shariah principles, offering interest-free banking products while maintaining a completely digital infrastructure.

In May 2025, Raqami Islamic Digital Bank Limited was awarded a restricted banking license by the SBP to commence pilot operations as a digital retail bank.

Raqami is backed by Pakistan Kuwait Investment Company (Private) Limited, a joint venture between Pakistan and Kuwait governments, and Enertech Holding Company KSC, a subsidiary of the sovereign wealth fund of Kuwait, the Kuwait Investment Authority.