Pakistan has a thriving $300 billion economy. Yet, most people still receive their salaries in paper money, and a staggeringly low amount of just over 21% of Pakistani adults have active bank accounts. Of these, only 7% are women. In a move to boost the nation’s economy, the State Bank of Pakistan (SBP) recently announced a new strategy to develop a new national digital payment system. Due to exceedingly low numbers of people currently using modern systems and local merchants unable to receive and process digital payments, this is seen as a vital move to promote financial inclusion.
Governor of SBP, Reza Baqir said, “this strategy lays out a road map and action plan for Pakistan to have a modern and robust digital payments network.” Moving to online or electronic payments will stimulate trade and provide a welcome boost to the nation's economy by creating around four million new jobs, resulting in $263 billion in new deposits, representing a potential market of $36bn, all by 2025 – an increase of seven per cent to Pakistan’s GDP.
Baqir also wants to lay the foundations for a “modern and robust digital payments network” which will adopt the best of established international legal and regulatory measures and reportedly, procedures are being implemented to onboard local merchants to accept digital platforms.
Whether this signals a move to make cryptocurrencies legal in the county is still to be seen, but Dragon is well-placed to help merchants and the population in several ways. Firstly, merchants could adopt Dragon Coin and the Dragon Social Wallet into their existing business operations. This would provide a convenient payment method with low fees of 0.5% blowing payment processors such as Visa and Mastercard out of the water. And, as Dragon Social Wallet to Social Wallet are entirely free, the millions of unbanked Pakistani’s would now have a way of operating in the digital payment world.
In the meantime, the SBP plans to create significantly faster digital payments systems, and the Pakistani government intends to 'gradually’ move towards accepting mainly electronic payments and is considering building a new platform to handle collections and disbursements.
The president of the World Bank, David Malpass, praised Pakistan's digital transformation strategy but noted that attracting other stakeholders to work with the SBP would be critical to driving forward the adoption of digital payment services.
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