VEON and Square Group Secure Digital Bank License to Transform Bangladesh Fintech

A joint venture between VEON and Square Group has secured a digital banking license from Bangladesh Bank, marking a significant shift in the country's financial landscape. For fintech professionals, this move signals the convergence of telecommunications and banking in a high-growth market, leveraging existing mobile ecosystems to provide end-to-end financial services to millions of unbanked citizens.

What was announced

The approval from the central bank of Bangladesh allows VEON Digital Financial Group and Square Group to establish a full-scale digital bank. This new entity will integrate with the mobile ecosystem of Banglalink, VEON’s local telecommunications subsidiary, and is designed to extend accessible financial tools to mobile users nationwide. The venture builds upon Banglalink’s existing Payment Service Provider (PSP) license, which currently supports its Mukto Pay digital wallet service.

The initiative is a core component of the "Invest in Bangladesh NOW!" public-private partnership, which VEON formally launched during the UN General Assembly High-Level Week in New York. To support this ambition, VEON has committed an initial anchor investment of US$250 million, part of a broader goal to mobilize US$1 billion in foreign direct investment for the country’s digital infrastructure, connectivity, and financial services. The digital bank aims to combine VEON’s global technological framework with Square Group’s extensive domestic manufacturing, distribution, and retail networks to reach communities outside the scope of conventional banking.

This expansion follows a successful period for VEON Digital Financial Group, which reported 59 million active financial services customers across its operations in Pakistan, Kazakhstan, and Uzbekistan as of the second quarter of 2026. The Bangladesh license complements recent regulatory and commercial milestones achieved by the group in Kazakhstan.

"Financial inclusion is key to eradicating poverty, and today's approval marks an important step toward that goal in Bangladesh. We're grateful to Bangladesh Bank and the Government of Bangladesh for their continued support in building the digital financial infrastructure the country needs. Together with Square Group, a trusted and well-established partner, this brings us closer to our commitment to bringing more of Bangladesh's unbanked population into the formal financial services system."

Kaan Terzioglu, Group Chief Executive Officer of VEON.

The companies involved

VEON is a Nasdaq-listed global digital operator that has transitioned from a traditional telecommunications provider to a multi-service digital ecosystem provider. The company maintains a significant presence in emerging markets, focusing on connectivity, digital finance, and AI. Its subsidiary, Banglalink, is a major player in the Bangladeshi telecommunications sector, providing the nationwide network and distribution infrastructure that will underpin the new digital bank's operations. Square Group is one of Bangladesh’s most prominent business conglomerates, with a history spanning 68 years. Founded by Samson H Chowdhury, the group has established deep roots in manufacturing, pharmaceuticals, and retail. The partnership leverages Square Group’s domestic trust and physical distribution reach alongside VEON’s global technical expertise. This collaboration is designed to bridge the gap between conventional banking and the unbanked population by utilizing a mobile-first approach that integrates directly with existing consumer habits.

What FF News has reported before

FF News has closely tracked VEON’s aggressive expansion into digital financial services across its footprint. In August 2026, we reported that VEON’s Banglalink Secures PSP Licence to Launch Mukto Pay Digital Wallet in Bangladesh, which served as the regulatory precursor to this full banking license. The group’s broader strategy for emerging markets was highlighted in July 2026 when VEON and Mastercard Partner to Scale AI-Driven Financial Services Across Emerging Markets. Additionally, VEON’s regional growth in the insurance sector was evidenced by the report that VEON and JazzWorld Acquire TPL Insurance to Scale Digital Coverage in Pakistan. Earlier milestones in the group's fintech journey include when JazzCash Successfully Launches New App for Business Owners in 2021, demonstrating a long-term commitment to digital financial tools.

What this means

This announcement places significant pressure on traditional Bangladeshi banks, which must now compete with a telco-backed entity that possesses immediate access to millions of mobile users. The "digital operator" model, which uses connectivity as a low-cost customer acquisition channel for financial services, is proving to be a formidable challenger to legacy banking structures in emerging markets. By securing a full banking license rather than just a payments permit, VEON and Square Group can offer high-margin credit and savings products, moving beyond simple transactions. The success of this venture will likely determine if other regional telecommunications providers pivot toward full-scale banking to offset declining voice and data margins.