Digital banks eye Pakistan’s unbanked population
Digital banks eye Pakistan’s unbanked population


Despite a general wait-and-see approach by global investors in Pakistan, digital banks are quietly moving ahead with plans to tap the country’s vast unbanked population.

In January 2023, Pakistan’s central bank approved five global and local financial institutions to establish full-fledged digital banks. With over 220 million people, Pakistan has the third largest unbanked adult population globally with about 100 million adults without a bank account.

United Arab Emirates (UAE)-based Mashreq Global Network-Pakistan Head, Sharmeen Niaz highlighted the significant potential for digital banking in Pakistan: “I believe, Pakistan’s banking sector is brimming with huge potential and is on the cusp of massive transformation. The move towards digital banking driven by technology, data and analytics is transforming Pakistan’s banking industry into an always-on one, offering customers 24/7 on-demand services, and convenience.”

With a smartphone penetration rate of 82%, Pakistan is becoming a mobile-first economy. In addition, the country has been recognised as an attractive global innovation hub, according to the UN’s Global Innovation Index. The supportive regulatory environment, including for digital bank licensing, digital onboarding of customers, and RAAST etc., is also encouraging innovation.

Mashreq Bank is one of the five financial institutions to receive a no-objection certificate (NOC) from the State Bank of Pakistan (SBP) to establish a digital bank. Niaz emphasised that the bank is investing in Pakistan to bolster the economy, and the NOC for digital banking will further contribute to the transformation of the country’s banking sector. The other four banks to have received NOCs include Easy Paisa DB, Hugo Bank, KT Bank and Raqami.

“Mashreq has been quietly investing in the country with Mashreq Global Network (MGN), channelising efforts to help bolster the economy…With the acquisition of NOC for digital banking, we will be further contributing to Pakistan’s banking sector and its transformation,” added Niaz.

In addition to offering convenience for customers, digital banking also enables a distributed workforce model, as demonstrated by MGN’s 100% work-from-anywhere model. “Presently, all our employees are operating under a 100% work-from-anywhere model,” she said. The bank has over 1,800 employees across India, Pakistan, and Egypt, with more than 250 professionals based in Pakistan. In total, the bank’s workforce includes 40% women.

“With over 61 million internet users, and robust payments and security infrastructure already in place, it is easy to operate digitally in the country. This coupled with our robust technology infrastructure and distributed workforce module, has enabled us to offer flexibility of working and collaborating from anywhere with our global teams,” she said.

Published in The Express Tribune, March 29th, 2023.

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