The move is the latest in the government’s push to liberalise the financial sector.
The Central Bank of Myanmar is set to grant licenses to four new private banks to launch financial services.
The private banks are Gems and Minerals Bank, Mandalay Farmer Development Bank, Sagaing Farmer Development Bank, and Tourism Bank.
A number of foreign banks have been allowed to provide export financing services in the country last March. The move has been lauded as it demonstrates further liberalisation of Myanmar’s financial sector, which is seen benefiting small businesses who can now gain access to credit at more competitive rates.
“The decision is a welcome development as Myanmar’s banking system has been highly restrictive for foreign players. Besides providing export financing services, the select foreign banks will be allowed to extend credit to foreign businesses as well as local banks,” a report from ASEAN Briefing.
However, much remains to be done to further open the country’s banking sector as foreign banks still face heavy restrictions as they are still banned from providing basic retail transactions like account openings, local money transfers, and loan extensions denominated in local currencies.
Photo from Michael Coghlan from Adelaide, Australia - Settling In, CC BY-SA 2.0
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