Doha: The Qatar Central Bank (QCB) is currently studying digital bank licensing and digital currencies, according to an official.
Speaking to The Peninsula on the sidelines of the 8th Doha Islamic Finance Conference yesterday, Head of the FinTech Section at QCB Alanood Abdullah Al Muftah said the central bank will soon set a direction on its future focus, particularly on different fintech verticals.
She added: “The direction will be clearer in the next couple of months. We’re currently trying to study the different aspects and verticals of fintech. We’re trying to set our direction. In the next couple of months, there will be greater understanding about the future focus of QCB. Each central bank should study digital banks, considering their growing significance in the global market. We also see the direction of the market moving towards having a digital currency. However, it’s still being studied whether we’re having a digital currency or not”.
According to a study by the International Monetary Fund (IMF), about 76 percent of Central Arab Banks are seriously considering issuing digital currencies, with at least two Central Arab Banks expected to issue digital currencies in the next three years.
Fintech companies also play a huge role in the fast growing fintech market. Al Muftah said Qatar’s Sandbox, which had a soft launch last year, now has three fintech companies currently operating in the payments sector, testing their solutions with QCB. More companies are currently being evaluated to enter the Sandbox, which is also set for an official launch soon, Al Muftah added.
Also speaking to The Peninsula on the sidelines of the event, Narayanan Srinivasan, Chief Operations and Digital Officer at Dukhan Bank said the bank is also considering establishing a digital bank in Qatar.
He said: “In terms of the journey forward, there are a few digital banks which are already in play in Far East and Europe. The logical transition is to explore that, whether it should be a dedicated bank, or whether it should be part of our own. It’s not yet final, we’re still at the thinking stage.
“The digital bank is something that we are currently mulling over in terms of one of the four things that we can bring to the Qatari market, which will actually make digital banking cutting edge, compared to what is currently happening in other parts of the world. But we do not want to rush through this. We need to figure out the economics behind it. Unfortunately, there are not too many use cases, either in the form of success or failure, for us to quickly decide that this is something that we can do. We need to figure out how do we actually take this to the market,” added Srinivasan.
He added that Dukhan Bank is currently exploring blockchain technology on the payment space. The bank also plans to launch new electronic services, including an e-kiosk, this year.
