A World Bank Report shows that in 2021, only 28.2% of men and 13.5% of women in Pakistan had access to bank accounts. This financial inclusion gap can be addressed through the use of QR codes and contactless transactions. QR codes are those pixelated squares that we scan with our smartphones to make payments. They have the power to improve financial inclusion by making payment methods more accessible and widespread. QR codes provide a safe and traceable alternative to cash transactions, which can help track the flow of funds and protect against illicit activities.
India’s experience with QR transactions can serve as a case study for Pakistan. A survey in India found that 68% of consumers preferred payments via QR codes because of their user-friendly nature and security features. The Reserve Bank of India regulates and oversees payment systems to ensure their secure and efficient operation. In India, digital payment transactions grew by 30% in FY21, reaching a total of 41.6 billion transactions. India’s digital economy is said to have grown six-fold through these financial inclusion policies.
In Pakistan, expanding financing capabilities and including the unbanked and excluded segments of the population are crucial steps to unlock its financial potential. QR codes can help street vendors accept digital payments, reducing reliance on physical cash and enhancing security. Vendors can attract a wider customer base and manage sales and income more efficiently, even without a formal bank account. Consistent use of digital payments can help vendors establish a financial history, offering opportunities for future financial services like loans and credit.
The State Bank of Pakistan has established ‘Raast,’ Pakistan’s instant payment system, to promote financial inclusion. It is important to broaden the range of financial services offered by Raast and include non-banking financial institutions to ensure access for people in rural and remote areas. Following India’s ‘Digital India’ program and launching media campaigns can promote the benefits of going digital and embracing QR-based payments. These efforts can contribute to a more resilient economy in Pakistan.
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