The central bank is in the final stages of formulating the regulatory framework for interoperable mobile banking system. Also, the State Bank expects that the management of Government to Person (G2P) programs like the disbursement of salaries and pensions, Benazir Income Support Program (BISP), Watan Cards, Pakistan Cards, tax collections services, etc, would soon be managed through the fast spreading branchless banking.
“We are already working closely with Pakistan Telecommunication Authority (PTA) and have also signed a Memorandum of Understanding (MoU) for enabling the interoperability framework where all banks and telecom companies can join hands to serve the customers,” SBP Governor Yaseen Anwar on Thursday told the 5th International Conference on Mobile Banking in Pakistan here at a local hotel. The SBP governor said the central bank aims to provide basic banking services to every adult and bankable citizen in the country. “As a large portion of our population has access to mobile phones, we feel that if a workable partnership between the banking and telecom sectors continues, we shall see our dreams come true,” he added. The mobile phone subscription, he said, had seen an explosive growth in Pakistan – total subscription now reaches to 112 million customers in all income segments of the society, and growth continues rapidly.
He, however, observed that banking accounts are owned by approximately 25 million customers, in a population of 180 million, largely belonging to high income segments while there are about seven million borrowers.
He pointed out that Pakistan has one of the lowest financial penetration levels in the world with 56 per cent of the adult population totally excluded, and another 32 percent informally served. “At the macro level, we will continue to work with the industry and the other regulators to promote a sound, safe, efficient and inclusive mobile commerce ecosystem.” The interoperable systems, he said, were essential to mass adoption of mobile commerce and added that presently financial institutions and telecom companies can choose whatever business model suits their needs i.e. One-to-One or One-to-Many. “Let me assure that all the existing and the prospective One-to-One or One-to-Many arrangements between banks and the Telcos would not be affected with the proposed regulatory framework,’ he added.
The governor emphasised that the existing agents’ network needs to be further capacitated to generate new demand, and to handle and service even larger volumes of transactions to establish the business viability of Branchless Banking operations. “Going forward, SBP will be initiating actionable research on the supply and demand side in collaboration with the Branchless Banking ecosystem for further development of such services in Pakistan.” Anwar said mobile phone banking was now the new market niche for both banks and Mobile Network Operators (MNOs), and many of them were preparing to enter in this exciting market in a big way. “In almost two years, the branchless banking deployments with 22,500 agents offering low-cost services all over the country, including in the hitherto neglected areas, have surpassed the 10,000 branch network of banks,” he said adding the fast mobile penetration and its continuing strong growth fuels expectations that transformational branchless banking models would prove a game-changer in improving access to finance in Pakistan.
