Baqir urges banks to offer digital products to underserved segment

KARACHI: Dr Reza Baqir Governor State Bank of Pakistan (SBP) has said that there are a number of opportunities for the banking sector to offer digital products and services to the underserved segment of the society.

Speaking as keynote speaker in an interactive discussion on “The Promise of Digital Banks” on Thursday, he said that although Pakistan is moving toward a major digital evaluation in its financial system, there are still some challenges that need to be addressed.

He said that being a regulator, SBP not only regulates the financial system but also makes efforts for the financial inclusion in the country to ensure the banking services in an easy and affordable manner to all Pakistanis.

“SBP sees its role not only as a regulator of the financial system but also as an enabler to promote goals of inclusion and innovation”, he added.

Pakistan is the world’s fifth largest country and has one of the youngest in terms of demography. Some 65 percent of Pakistan’s population is between 15-40 years old. This is the prime sweet part for offering a digital product and services, he mentioned.

Governor SBP said that the country has a stable and well-capitalized banking system with excellent asset quality and banks also resilient in time of the recent Covid pandemic due to supportive measures by the SBP.

Sharing the statistics of the banking sector, he informed that presently some 43 licensed banks including 32 commercial banks and 11 microfinance banks are working with more than 17,000 branches across the country. In addition, there are some 82 million unique bank accounts including mobile bank accounts.

There are some 189 million mobile telecom subscribers in Pakistan and out of these there are 108 million subscribers that are 3G or 4G subscribers. However, 50-100 million mobile phone subscribers don’t have bank accounts.

He said that e-banking is gradually growing in Pakistan and overall, some 1.2 billion transactions were recorded during the last year. In terms of value e-banking transactions are worth $500 billion, which is more than the GDP of Pakistan. Overall e-banking transactions showed a growth of around 30 percent from the previous year.

“We have some 11 million mobile app users for digital financial services and about 7 million Internet banking users for digital financial services, which means there are at least 70 million who have bank accounts but not currently using digital means such as apps or the internet for their banking needs,” Baqir mentioned.

He said that being a regulator SBP is fully supporting the financial sector to promote digital banking in the country.

Copyright Business Recorder, 2022