Qatar Central Bank issues landmark digital payment licenses to 2 telecom providers

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Qatar is ushering in a new era of digital payments despite maintaining a ban on digital assets, with its central bank launching a licensing regime for digital payment service providers by issuing the first pair of permits.

Reuters reported that the beneficiary companies are telecommunications giants Vodafone Qatar and Ooredoo. Vodafone’s iPay and Ooredoo’s Ooredoo Money can now support digital payments under the supervision of the Qatar Central Bank (QCB).

In a Tweeter, the QCB said the move was intended to help grow the fintech sector and improve financial inclusion. He added that the approval of other digital payment service providers would follow soon.

The approval is part of the country’s preparation to host one of sport’s biggest events, the FIFA World Cup, later this year. Qatar has integrated more payment solutions for the host of tourists it intends to host.

Last week, QCB announced that it had approved several commercial banks to support Google Wallet, allowing their customers to make mobile payments with Google Pay. Banks include Dukhan Bank, Qatar Islamic Bank, Qatar International Islamic Bank and Qatar National Bank.

Likewise, QCB now accepts all digital wallet solutions for cards, such as Samsung Pay and Apple Pay.

Qatar still not interested in digital assets

As it pushes to welcome digital payments, Qatar has enforced a ban on trading and storing digital assets since 2020, joining eight other jurisdictions. In a recent interview with Bloomberg, the managing director of sovereign wealth fund Qatar Investment Authority (QIA) said that Qatar still has no interest in digital currencies.

The country is instead looking to make significant investments in blockchain technology, Mansoor bin Ebrahim Al-Mahmoud said. In the same interview, QCB Governor HE Sheikh Bandar bin Mohammed bin Saud Al Thani called digital assets too risky and volatile.

Meanwhile, QCB is working on a central bank digital currency (CBDC) which it hopes will help further digitize payments. First disclosed in March, the QCB said in a June progress update that digital currency development was still in the “foundation stage.”

The central bank governor said the QCB is still exploring the pros and cons of issuing a CBDC while considering the appropriate technology and platform to launch it.

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Elaine R. Knight