Pak­istan lead­ing way in S. Asia in dig­i­tal fi­nance, branch­less bank­ing

The Pak Banker - - NATIONAL -

Pak­istan is lead­ing way in South Asia in dig­i­tal fi­nance and branch­less bank­ing amid in­tro­duc­tion of Na­tional Fi­nan­cial In­clu­sion Strat­egy (NFIS) - a roadmap to achieve fi­nan­cial in­clu­sion goals.

Around 6 per­cent of adults in the coun­try have mo­bile ac­counts as com­pared to South Asia's av­er­age of less than 2.6 per­cent. Pak­istan is also among the 25 coun­tries, the World Bank Group and part­ners are pri­or­i­tiz­ing as part of ef­forts to reach Uni­ver­sal Fi­nan­cial Ac­cess by 2020. Sta­tis­tics have said it was sup­port­ing th­ese coun­try-led ef­forts which were re­flected in Pak­istan's Coun­try Part­ner­ship Strat­egy (2015-19), with re­forms and other ac­tions to ex­pand fi­nan­cial ac­cess and in­clu­sion. Hav­ing a for­mal and reg­u­lated trans­ac­tion ac­count opens ac­cess to other fi­nan­cial ser­vices, such as sav­ings, pay­ments, in­sur­ance and credit, all of which can help peo­ple bet­ter man­age their lives and re­duce poverty.

Last year Pak­istan launched its Na­tional Fi­nan­cial In­clu­sion Strat­egy (NFIS) with the goals to achieve uni­ver­sal fi­nan­cial ac­cess, with a tar­get of ex­pand­ing for­mal fi­nan­cial ac­cess to at least 50 per­cent of adults, in­clud­ing women and youth, and to in­crease per­cent­age of SME loans in bank lend­ing to 15 per­cent by 2020. Pak­istan's fi­nan­cial in­clu­sion strat­egy is cur­rently fo­cus­ing on four ar­eas in­clud­ing pro­mot­ing dig­i­tal trans­ac­tion ac­counts and reach­ing scale through bulk pay­ments, ex­pand­ing and di­ver­si­fy­ing ac­cess points, im­prov­ing ca­pac­ity of fi­nan­cial ser­vice providers and in­creas­ing lev­els of fi­nan­cial aware­ness and ca­pa­bil­ity.

Re­gard­ing Pak­istan's Fi­nan­cial Ac­cess Sta­tis­tics, the data said 13 per­cent of Pak­istani adults have a for­mal ac­count, less than 5 per­cent of women are in­cluded in for­mal fi­nan­cial sec­tor, 27.5 mil­lion of Pak­istani adults cite dis­tance to a fi­nan­cial in­sti­tu­tion as a bar­rier to open­ing a fi­nan­cial ac­count, 2.9 per­cent of adults in Pak­istan have a debit card.

At the same time, Pak­istan is lead­ing the way in South Asia in dig­i­tal fi­nance and branch­less bank­ing. The World Bank Group has pro­posed Pak­istan fol­low­ing ac­tion items to en­hance fi­nan­cial ac­cess in the coun­try: Th­ese are to shift all govern­ment-to-per­son pay­ments from cash to dig­i­tal pay­ments, fol­low­ing the suc­cess of the Be­nazir In­come Sup­port Pro­gram in open­ing up ac­cess to fi­nan­cial ser­vices. Cre­ate in­cen­tives for pri­vate sec­tor to use elec­tronic pay­ments in­stead of cash when pay­ing for pri­vate sec­tor in­voices and salaries. Build on suc­cess of Easy­paisa, twenty mil­lion cus­tomers con­duct nearly 650,000 through Easy­paisa which is ac­cepted over 75,000 shops in more than 800 cities across the coun­try.

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