doing business in myanmar – what you need to know as a singaporean
Myanmar will initiate the first round of foreign bank licencing under Daw Aung San Suu Kyi’s government, aimed at further opening up an industry that was formerly closed off to international players.
The central bank announced that banks can apply for either a branch licence – which allows a range of wholesale banking activities – or a subsidiary licence, which permits both wholesale and, from January 2021 onwards, onshore retail banking services.
A branch licence and subsidiary licence require a minimum paid-in capital of US$75 million and $100 million respectively.
The statement did not specify the timeline for the latest round of licencing, but the central bank will be sharing requests for Expression of Interest (EOI) with eligible banks in the coming months.
Myanmar may also greenlight foreign ownership in domestic banks exceeding 35 percent starting from January 2020 on a case-by-case basis, the announcement says.
The central bank last January approved foreign equity ownership of up to 35pc in Myanmar banks without changing the nature of the lenders. This is in line with the Companies Law, which came into force in August 2018.
Two rounds of foreign bank licencing were launched by the Thein Sein government. The first in 2014 saw nine banks awarded, and the 2016 round, launched shortly before the incumbent administration took office, granted licences to four Asian banks.
In total, there are 13 non-Myanmar lenders currently allowed to operate in a limited capacity. Another 51 banks and finance companies have representative offices, while there are 27 local banks.
With a population of over 50 million, Myanmar remains largely unbanked until this day, although digital payment and wallet system like Wave Money and KBZ Pay of late has seen an increase in subscribers.
Source : Myanmar Times
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