KARACHI: Prime Minister Shahid Khaqan Abbasi on Friday launched a scheme to promote home remittances through mobile-wallets.
“Government of Pakistan is taking several strategic initiatives to promote inflow of home remittances in the country,” Abbasi said, addressing the launching ceremony of ‘Promotion of Home Remittances through M-wallet Accounts’.
“The scheme will help in channelising home remittances through branchless banking (BB) channels. It will help achieve twin objectives.”
The Prime Minister said the scheme will facilitate the populace by provision of home remittances in swift, convenient and cost effective manner by utilising the network of BB agents across Pakistan. “Secondly, it will help enhance the usage of m-wallets and creation of digital accounts.” Abbasi also announced government’s budgetary support to incentivise home remittances through m–wallet accounts.
The premier said financial inclusion is considered as one of the key instruments for economic development.
“Unfortunately, Pakistan is among the countries accounting for around five percent of the world’s unbanked population,” he said. “In Pakistan, only 23 percent of the adult population has access to formal financial services.”
Abbasi said remittances have been the second-highest source of foreign exchange earnings for the country after export receipts.
“Over the past 10 years, remittances have grown at a compound annual growth rate of over 12 percent,” he added. “Pakistan’s relatively better performance in the region is principally attributed to sustained increase in emigrant workers during past few years and supportive policies of the government and the State Bank.”
Governor SBP Tariq Bajwa said the scheme will help in increasing financial inclusion in the country and making transfer of home remittances faster and at low cost, “thus competing with informal channels of delivery.”
“Against the clear challenges of limited financial access in the country, SBP has been pursuing a long-term strategy to address financial exclusion through BB regulatory and market-development initiatives,” Bajwa said. “Alternative channels are providing flexible, cost-effective, and convenient modes of doing transactions.”
SBP Governor said the industry has progressed remarkably during the last few years.
Total 27.3 million mobile wallets (branchless banking accounts) have been opened as of June, while branchless banking agents have increased to 402,000. “This growth has resulted in providing basic banking services close to locations of customers, thereby saving their time and travelling costs,” Bajwa added. “I believe it is high time to leverage technology led banking to provide tailor made solutions to the masses to satisfy their financial needs.”
Governor SBP said all BB providers and individuals receiving home remittances are eligible for this scheme.
“The incentive is being provided through public-private partnership shared equally between GoP (government of Pakistan) and BB provider,” he added. “Through this initiative we will be able to compete with the informal channels on both efficiency and cost.”
The beneficiaries of the scheme will be able to withdraw cash from auto teller machines, bank branches or branchless agents. They will also be able to make digital payments to settle their utility bills by using their m-wallets.
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