ISLAMABAD: The government has requested the World Bank for restructuring and extending the “Pakistan Financial Inclusion and Infrastructure Project”, worth $137 million, which was aimed at contributing to increasing access and usage of digital payments and other financial services for households and businesses in the country.
Official documents revealed that the project has experienced delays with the implementation of planned payment system upgrades and operationalisation of the risk-sharing facility in support of bank lending to small and medium enterprises (SME) which offer opportunities for additional project impact.
In November 2022, the government requested to restructure and extend the project. Given the acute impact of the floods of 2022 and mitigation efforts of Covid-19 on the microfinance sector, it was requested that the RSF/ CDNS funds be reallocated to the Line of Credit (LoC). The LoC would prioritise those in the flood-impacted areas, with a revised operations manual.
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The bank; however, noted that the project was approved by the World Bank Board on 15th June 2017 and became effective on 28th March 2018. The project development objective is to contribute to increasing access and usage of digital payments and other financial services for households and businesses in Pakistan.
This will be done by: (a) improving market infrastructure and institutional capacity, (b) supporting the uptake and usage of Digital Payments and Financial Services and by (c) improving access to financial services for micro, small and medium enterprises (MSMEs).
The project will seek to substantially increase access and usage of financial services by women and support women-owned MSMEs.
Progress towards achievement of project development objective has been strong. The three project development objective level indicators related to number of digital transaction accounts, electronic payments per capita and number of unique beneficiaries (borrowers) have all substantially exceeded the project targets.
In addition, three out of six intermediate-level indicators (number of digital transaction accounts – female, number of unique female beneficiaries, and number of loans disbursed) have also exceeded the project plans.
Copyright Business Recorder, 2022