‘Digital channels can lead to enhanced financial inclusion’
KARACHI: Digital finance channels can lead to rapid expansion in access to financial services, particularly to those currently not served, thus help promote economic growth of the country.
Addressing State Bank of Pakistan (SBP)’s International Branchless Banking moot on ‘Innovations in Digital Finance for Financial Inclusion’, Finance Minister Ishaq Dar said digital payments could be an efficient and transparent medium for government payments. “By digitising government to person (G2P) payments, our government will strengthen the e-governance framework,” he added.
On successful experience of digitising the leading social welfare schemes of the government for income support programmes and internally displaced persons (IDPs), he expressed the desire of the government to work with global agencies like United Nations’ (UN’s) ‘Better-Than-Cash-Alliance’ to chart a roadmap for digitising government’s retail payments.
Dar stressed on the need to further develop the digital finance to expand services to small farmers and pensioners. He advised to strengthen the customer grievances’ redress mechanism.
Appreciating SBP for its strategic vision and commitment towards improving financial inclusion in the country, he said SBP financial inclusion policy framework and branchless banking models were recognised globally. Pakistan’s microfinance and branchless banking sectors have seen inflow of foreign capital and increased use of innovative technologies.
Dar desired to be personally involved in steering financial inclusions initiatives in the country through the newly created National Financial Inclusion Council to assign the much-needed priority to this issue. The Council will draw membership from important stakeholders including relevant government ministries/departments, financial and telecom regulators and industry to set and monitor activities and national targets for digital financial inclusion.
SBP Governor Ashraf Mahmood Wathra highlighted that high level of financial exclusion has led society to rely on excessive use of cash especially for payments and savings which was risky, costly and inconvenient to the businesses and public at large.
He pointed that SBP-led initiatives stimulated the market forces to drive innovation and growth in branchless banking. Highlighting the growth performance, he said branchless banking transactions with an average size of Rs 5,600 indicate that they were now reaching out to the poor and low income groups.
The SBP governor said that greater promise of branchless banking lied in the ability of banks to build new or leverage existing agents’ network and to convert massive SIM subscribers’ base into banking account holders. This transformation was already underway with the support of an evolving branchless banking ecosystem, he said.
He said that Head of DFID-Pakistan, Richard Montgomery, was seeking to work in partnerships to promote innovative approaches for financial inclusion. Given the success of DFID partnership with State Bank, this partnership under the current Financial Inclusion Programme (FIP) had been extended for a further five years, he said.
Chairmen of Pakistan Telecommunication Authority and National Database Registration Authority also spoke on the occasion and demonstrated their commitment to support branchless banking growth in Pakistan.
During the conference, two accords were signed to advance digital financial inclusion. The first was signed between SBP and NADRA reducing the verification cost to Rs 10 for each m-wallet account opening at industry level. The second was signed between Gates Foundation and DFID to set up a Digital Financial Inclusion Unit in Karandaaz, which is a newly incorporated company to support small and growing businesses in Pakistan.
” 
” 
” 
” 
