Thursday, March 23, 2023

Pakistan approves digital payment service PayFast

E-commerce industry in Pakistan is growing at an annual rate of 58%

The State Bank of Pakistan (SBP) gave the green light for the pilot operation of PayFast payment gateway, facilitating more than 80 million 3G/4G users in the country.

The move will give the e-commerce industry to a massive boost in Pakistan. COVID-19 is one of the factors behind the decision as more people are trying to make purchases online and avoid physical contact.

The service is being offered by Avanza Premier Payment Services (APPS), a collaboration formed in 2015 between Avanza Solutions and Premier Systems.

Moving toward a cashless economy

Syed Adnan Ali, CEO of Payfast, welcomed the development and said that in the midst of the current situation, the move will help the economic growth as well as an important step towards a digital economy. “Digitalisation is our ambition and an indispensable need of society particularly after the COVID-19 pandemic,” Alis said.

“Our Vision is to provide Intuitive, reliable and a high standard solution to our valued partners and consumers while contributing toward the economy. We are very passionate that PayFast will act as a catalyst to digitalize the economy and will lead Pakistan towards a cashless journey.”

Currently, 90% of online transactions are based on cash on delivery due to a lack of options. Typically, people can use services such as mobile wallets to send money to the merchants. Even in regular transactions, payments through bank instruments are commonplace in larger businesses, smaller entities and individuals prefer cash. Similarly, credit card usage is also rare because of extremely high-interest rates charged by issuers.

Massive growth potential

Pakistan’s current e-commerce industry is about $2 billion annually. There has been an average 58% growth in the sector for the last few years. There is a lot of potential for the industry to further grow. The novel coronavirus will also boost the industry, at least in the medium term. Payment options like PayFast should be the perfect encouragement for users to indulge in online purchases.    

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