Electronic Money Institutions (EMIs) opened approximately 47,000 freelancer e-wallet accounts and onboarded 4,956 micro-retail merchants since the beginning of their commercial journey in FY22, according to the Annual Payment Systems Review for the fiscal year 2022-23 (FY23), released by the State Bank of Pakistan (SBP).
These operators showed steady growth by opening more than 2 million e-wallets and processed 86.8 million transactions worth Rs. 234 billion as of June 2023.
This resilience and growth in Pakistan’s payments market infrastructure can be attributed to the proactive steps taken by the central bank. These initiatives include revised regulations for EMIs, setting boundaries for unauthorized digital lending platforms, laying out guidelines for the reliability of services of digital channels, and enhancing the payment card infrastructure in Pakistan.
EMI also issued 2.82 million debit cards to different users in the period having a 5 percent share in overall payment cards being circulated in the financial system.
SBP issued revised regulations for EMIs recently which allowed non-banking entities to obtain EMI licenses. EMIs are expected to offer interoperable and secure digital payment products and services to end users.
During FY23, 81.5 million transactions amounting to Rs. 222.2 billion were processed through these EMIs. Customers used the EMI platform mainly for electronic funds transfers (62 percent) and e-commerce purchases (14 percent) transactions.
Cash-based transactions comprised only 6 percent of the total transactions which signifies an important headway towards the adoption of digital channels, according to the SBP.
There were 12 EMI/ fintech operators listed as legal entities by the SBP. Four of these companies have lived their businesses including NayaPay, Finja, SadaTech, and CEMPECC. In 2023, two fintech operators including Checkout and Careem Payment Solutions withdrew their license from the central bank citing the reason for the prevailing economic slowdown induced by the political uncertainty in the country.
