Emphasizing the transformative potential of a cashless society, Jazz CEO Aamir Ibrahim has outlined a strategic vision for accelerating Pakistan’s transition to a digital economy. Speaking to journalists, Ibrahim highlighted the critical need for policy interventions to enhance financial inclusion, improve tax compliance, and unlock new economic opportunities.
Aamir Ibrahim, also Chairman of Mobilink Microfinance Bank and Telecom Operators’ Association of Pakistan, proposed several key measures to promote digital financial services. He emphasized the integration of smartphones, SIM cards, and digital wallets into the national identity card issuance process, potentially funded by the Universal Service Fund. This, he believes, will ensure universal access to digital financial services.
He suggested establishing a dedicated forum to monitor and support cashless economy initiatives, fostering cross-industry collaboration to address challenges and recommend policies. To incentivize digital payments, Ibrahim proposed reducing taxes on digital transactions for both customers and merchants, citing Islamabad’s example of lower sales tax rates for digital payments in restaurants.
Acknowledging the pivotal role of SMEs in Pakistan’s economy, with approximately 3 million lacking commercial funding access, he recommended allocating 15-20% of commercial funding to support these enterprises and their supply chains. Ibrahim also urged the public sector to lead by example by mandating digital payments for organizations like Utility Stores Corporation, Central Directorate of National Savings, and Pakistan Post.
Aiming to expand the merchant base, he suggested increasing the number of digital payment-accepting retail stores to three million by 2030. Additionally, he recommended updating the eCommerce Policy within six months to phase out Cash on Delivery (CoD) transactions, proposing a cap of PKR 3,000 on cash payments for basic commodities.
Key highlights of proposal
- Integration Proposal: Incorporate smartphones, SIM cards, and digital wallets with national identity cards.
- Tax Incentives: Reduce taxes on digital transactions for customers and merchants.
- Support for SMEs: Allocate 15-20% of commercial funding to small and medium enterprises.
- Public Sector Leadership: Mandate digital payments for government organizations like Utility Stores Corporation and Pakistan Post.
- Expand Merchant Base: Increase digital payment-accepting retail stores to three million by 2030.
- Update eCommerce Policy: Phase out Cash on Delivery (CoD) and cap cash payments for basic commodities.
- Digitize Remittances: Enable mobile wallets to receive international funds, bypassing traditional banks.
- National Financial Inclusion: Pakistan has over 117 million branchless banking accounts.
Highlighting the need to digitize remittances, Ibrahim advocated for enabling mobile wallets to receive international funds, bypassing traditional banking infrastructure to reach remote and underserved populations.
Drawing comparisons with regional progress, Ibrahim noted the advancements in digital financial inclusion by countries like India and China, urging Pakistan to leverage technology for economic growth. He highlighted Pakistan’s positive trajectory with over 117 million branchless banking accounts, surpassing traditional bank accounts, and noted that RAAST IDs have exceeded 36 million.
Ibrahim praised the contributions of the State Bank of Pakistan, Pakistan Telecommunication Authority, and Securities and Exchange Commission of Pakistan in driving digital and financial inclusion through supportive policies.
In closing, Ibrahim called on the government and stakeholders to harness Pakistan’s growing fintech landscape, fostering innovation and investment to accelerate the shift towards a cashless economy and its associated benefits.