Covid-19 vs Digital Banking in Pakistan & Payments in Pakistan, digital conference organised in Pakistan

Karachi, Pakistan – 28^th March, 2020 – In order to discuss the challenges faced by the banking sector in Pakistan in the time of COVID-19, a virtual one-day conference was conducted on March 28th, 2020 by co-hosts and organisers, Abdul Basit and M. Umair Khan. The event brought together industry experts, practitioners and regulators and revolved around current challenges faced by the banking sector owing to the lock-down situation and ideas were exchanged with regards to possible future interventions.

The event kick started with a keynote address delivered by Mr. Nadeem Hussain, Founder and Coach Planet N Group of Companies, followed by a plenary session on implications of COVID-19 on Digital Banking. The panel featured industry experts like Mr. Omar Moeen Malik, Group Executive Director at the Telenor Bank, Karim Jindani, Co-founder and CEO of Paysys Labs, Omar Bin Ahsan, CEO of Haball and Muhammad Raza Sales Head of Infobip, as speakers.

Mr. Hussain commented upon the pulverized reality of digital banking of Pakistan to the forum and observed that the banking or Payments system is still not capable of serving Pakistan digitally. He stated that Pakistan still remains a cash economy with merely 30% of the printed notes being deposited in bank accounts. Although 13 years have passed since the launch of digital Utility payment, BISP, EOBI and Agri systems and 30 million bills are generated every single month in Pakistan, but still 60% of it is yet being paid in bank branches or Nadra, with scant use of digital wallets.

He cautioned that once the threat posed by COVID-19 subsides, there is a possibility that Pakistan will fall back on the brick and mortar model, because our customers still prefer physical channels over digital transactions due to gaps in our system.

Group Executive Director – Telenor bank, Mr. Omar Moeen Malik sharing insights on the theme of “Pre and Post Corona Digital Banking & Payments”, commented that Pakistan, as compared to other countries, is in an extremely difficult situation, as the banks find themselves in an unfortunate scenario owing to lack of preparation and industry coordination. He observed that due to the COVID-19 threat, ATMs and branches have been rendered useless. Merely a few million customers are obtainable customers and asset for the banks right now. Markets are down so merchant is down, debit card not capable of fulfill the intention because of e-commerce enabling. Our banking sector has come to a stand-sill.

Omar Bin Ahsan, CEO of Haball, emphasised upon the bottleneck of digital ordering and payments. He observed that the banks were well aware of this challenge and they understand that it can be countered and does not require a major innovation or a big adoption of any huge change.  During the COVID-19, the risk of cash delivery is the major issue of the industry, which becomes a cause of the collective failure of the system. Considering that use case is not digital end to end as yet, giant manufacturers are losing business since customers don’t trust the system as yet.

Co-founder and CEO of PaySys Labs, Karim Jindani pointed out that there are countless products for customer side in the marketplace, but on the business side, we are still using obsolete methods. He counseled that State Bank of Pakistan must to make the mandatory need of corporate solution for every single bank, this will lead the industry to remove paper established payments.

Concluding Note:

All major players in the FinTech industry are competing to bring digital accounts but e-wallets without the traffic will be of no use. We need to find out the use cases where customers have no other choice than to use digital wallet instead of cash.

If we really need an immediate change, COVID-19 can be game changer for the digital industry. We all need to collaborate and work together towards our goal and we hope, we will continue receiving directions from the market leader.