The Federal Government plans to establish a National E-commerce Gateway through the State Bank of Pakistan (SBP), with the support and coordination of relevant stakeholders, aimed at increasing the value of e-commerce trade by three-folds before 2020.
According to government estimates, the potential market in Pakistan was small, ranging from $60 million to $100 million in 2015, but it carries an enormous growth potential going forward. Hence, the gateway could help in facilitating e-commerce to exceed the value of trade to over a billion dollars by 2020.
As tens of millions of new wireless broadband subscribers are expected to sign up in the future as 3G and 4G services expand to new areas, overseas investments are likely to continue in the e-commerce sector on top of the current level of investments.
Digital Pakistan Policy
The Ministry of IT and Telecom (MoITT) in its released Digital Pakistan Policy 2017 lays focus on e-commerce and e-banking through digital, advanced and innovative solutions to enhance contribution of various sectors in the economy.
The policy stated that the government and the state bank will develop a framework to allow e-banking activities in order to maximize the use of mobile financial services. This will help promote e-banking, m-banking and financial inclusion in the country.
It will encourage the use of e-commerce amongst general public through awareness campaigns. This will help promote a culture of e-commerce in the country which supports electronic business transactions at national, regional and international levels.
Promotion of E-commerce
The government will promote Pakistan as a competitive Foreign Direct Investment (FDI) destination for e-commerce as well as attract local private sector participation and investment in the development of e-commerce solutions.
It will promote the active participation of Small and Medium Enterprises (SMEs) and disadvantaged groups to enhance their effective participation in such activities.
In this regard a regulatory group will be formed for the coordination of different ministries and regulators to formulate e-commerce framework/policy guidelines in consultation with relevant stakeholders to establish and safeguard the users and merchants’ trust in the e-commerce sector.
This will include measures such as appropriate light touch regulation, tax rationalization, trade facilitation, Online Dispute Resolution (ODR), Consumer Protection and privacy etc.
Framework Requirements
However, a legal and regulatory framework for e-payment systems is a pre-requisite for e-commerce not only to create an environment of trust between the providers and users, but also to prevent potential abuse and crime.
Therefore, an enabling framework needs to be further strengthened, including policy and legal provisions for improving financial and banking systems, security measures and consumer financial services.
The policy will stress on promotion of internet merchant accounts to facilitate B2B and other in-bound transactions.
It will address anticipatory changes in regulatory frameworks in line with international obligations such as those being envisaged under the World Trade Organization (WTO) for signing of fruitful multilateral agreements.
Ecosystem of E-commerce
E-commerce is gradually going mainstream, especially in urban areas of the country. From mobile handsets to home appliances, everything is available online. Unique ideas, quality of service and discount packages are also helping promote the online shopping industry.
Companies such as Daraz, Yayvo, MyGerry’s are promoting online shopping in collaboration with different branchless banking companies. Online sales events like Eid sales, Pakistan Day discounts and Black Friday have helped increase awareness.
At the consumer level, different companies are providing various services, for example Careem and Uber are offering discount packages on e-payment through credit cards. There are many other companies offering services at corporate level too using the e-commerce model.
The central bank is also working on the concept of setting up Digital Banks in the country which will boost the utility of e-commerce at domestic and commercial levels in the country.
Off topic but I got frustrated by so called activation of credit card every time I had to pay in Pak ruppee on some Pakistani websites (overseas banks do not give a good rate on PK currency using their card).
Pakistani banks not only charge activation charges for a limited time activation but I was told that there will be a mark up on the amount used (not the usual mark up).
This is good money minting strategy of Pakistani banks in the name of security of your card but can be solved by One Time Pin (OTP) on your registered mobile number or email, also there can be a limit on online daily usage or a separate card for online usage (a supplementary card with lower limit).
I prefer using other currency card even for Pakistani websites than paying ghunda tax to Pakistani banks.
There is no fees on card activation on some banks, I have used, UBL, HBL cards and they do not charge any activation fees.
Also HBL has enabled all debit cards for internet transactions secured by Mastercard and verified by visa (VBV).
The surcharge you’re talking about is 4% FED on foreign currency transactions.
Which UBL debit card needs no activation except wiz card? And also HBL debit cards need activation too.
Not anymore. HBL wont need any activation starting 28th April 2017.
Activation is not required by some banks. Moreover, you can activate you card for unlimited time or for maximum period allowed by your bank to avoid activation charges.
I use both Standard Chartered and Faysal bank credit card online without any activation
UBL Wiz Card doesn’t require activation. Thus, no session charges. You can learn more on their website.
Also, to avoid markup, better use debit cards.
Where in this blog it mentions or give details regarding setting up national e-commerce gateway other than the title? this blog is not giving any value addition on top what is already known, even that is more than what this article has shared, a sorry read.