Raising the Bar for Pakistan’s Fintech Ecosystem

Pre-2008, Ahsan Ahmed, the owner of a small clothing store, would make biweekly trips to the post office to send a money order to his family in Lahore. After enduring traffic jams, slow customer service and filling out endless forms, his family would eventually receive the funds three to four working days later. His story points to the fact that before OTC money transfer services like Easypaisa and JazzCash entered the market, unbanked individuals in Pakistan had to put up with long-winded methods to perform basic financial transactions.Today, with a broadband penetration of 46% plus and a mobile penetration of over 85%, Easypaisa and JazzCash are able to offer a range of digital financial services to 20 million monthly users, and in doing so, have paved the way for the opening up of Pakistan’s fintech space. The relative success of Pakistan’s fintechs is due to the fact that traditional financial institutions have lengthy and strict documentation requirements for opening accounts, taking out loans and performing other services. Fintechs, however, can operate as non-bank licensed entities and cater to individuals who lack the required documentation or do not have access to basic financial services.