In an effort to enhance the country’s digital payments ecosystem, Reza Baqir, governor of the State Bank of Pakistan, has launched the National Payments System Strategy (NPSS).
The central bank has created the strategy to develop a more robust digital payments infrastructure, with the intention of creating a legal and regulatory framework to support innovation in the space. Pakistanis would benefit from easier access to financial services and greater financial inclusion, for women in particular, according to a press release.
The plan, which is posted on the bank’s web site, also references the impact that digital payments could have on the country’s economy.
“By migrating to electronic means, the strategy intends to boost Pakistan’s GDP by 7%, creating 4 million jobs, resulting in $263 billion in new deposits, representing a potentialmarket of $36 billion, all by 2025,” it says.
The plan notes that Pakistan’s economy is currently dominated by cash. The country does not have either a well-developed electronic payments ecosystem or an interbank system for settling funds.
It suggests that government benefit or other payment programs can help to establish a broader ecosystem by ensuring that program recipients have deposit accounts. The government’s use of digital payments for its programs would also help stimulate investment in the networks and other infrastructure needed to support those accounts.
At the launch event, Baqir announced new rules for merchant onboarding, as well as the bank’s plans to develop a faster payments network.
As for those in favor of the plan, World Bank President David Malpass, who attended the launch event, feels “this movement by the Central Bank is coming at a good time because there has been time to stabilize [the economy] after the start of the new administration. And that stabilization will, I think, facilitate growth going forward,” he said in an interview with The International News.