What Is The Current Enhancement In the Digital Payment System Of Pakistan In 2021?

You can send money to Pakistan with just a few clicks from your money transfer mobile application through a digital payment gateway. “Digital Payments” is a growing concept in Pakistan that aims to give a basket of solutions to its citizens, and it is rapidly gaining traction in the Pakistani market. More than half of the population lacks access to traditional and mobile banking services. Electronic B2B payments, regardless of transaction value, are rarely used, particularly by micro and small retailers. Cash is the most popular payment method since it is seen as “secure” by practically all businesses and suppliers.

According to a recent McKinsey Global Institute analysis, Pakistan’s digital finance potential is estimated to be over $36 billion by 2025, resulting in a 7% increase in GDP, 4 million new jobs, and $263 billion in new deposits. According to the State Bank of Pakistan’s (SBP) annual performance assessment (2017), Pakistan is fast moving toward digital means of payment adoption, with 1/4 of all electronic transactions increasing by 17% yearly in 2016-17.

What Are The Steps Taken By The Government Of Pakistan Towards Digitalization Of Payment System?

The government of Pakistan is continuously making efforts to increase online money transfers to Pakistan from overseas Pakistanis in developed countries. Consumer interaction with the new fast payment platform will be shaped by market development, operational challenges, and payment preferences. Connects governmental entities to the podium to make social programs more accessible and transparent.

All participants benefit from a single infrastructure that provides interoperability. Consumers are still cash-centric, thus digital and card-based payments are struggling to gain traction. Raast, a new quick payment system spearheaded by the State Bank of Pakistan (SBP) and payments gateway Karandaaz, launched in mid-January 2021 with the goal of increasing money transfers to Pakistan and upgrading the country’s existing digital infrastructure.

Pakistan’s payment infrastructure is still in its infancy, which has contributed to the country’s low volume of electronic transactions. Building a low-cost, interoperable platform will be difficult in a country where financial literacy is now at 13%, with minimal banking penetration and a customer trust gap in secure transactions, as well as accompanying high payment prices. Private money transfer services are promoting online money transfer services in the country. The most frequent users of digital payment systems are overseas Pakistanis, who regularly send money to Pakistan online to support families and investment purposes.