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Islamabad, Pakistan (Mehtab Haider/The News International) | Finance Minister Asad Umar asked the central bank to review its rules and regulations to make them more attractive for foreign digital payment operators, including PayPal, in the multimillion dollars of ecommerce market currently dominated by cash-on-delivery.
Umar directed the State Bank of Pakistan (SBP) to review rules/requirements pertaining to payment system operators and providers specifically related to the threshold for minimum initial capital requirements in order to encourage new entrants and expedite the work on unified payment interface and national payment gateway.
The finance minister was addressing a meeting to review the information technology exports and digital payments to drive digital inclusion. Umar also recommended a team of stakeholders from the ministry of information technology and telecom and SBP to establish contacts with PayPal with an engagement of Pakistani Ambassador to the US and renowned Pakistani expatriates working in the Silicon Valley.
The meeting aimed to roll out a structured process to address major issues and challenges being faced by the IT and telecom industries to drive the socioeconomic agenda of the government.
The focus of the meeting was to discuss impediments and bottlenecks being faced by the information technology sector especially in the digital payments domain and to decide on measures to settle the issues.
The minister further directed the State Bank of Pakistan to review its existing mechanism, which allows 30 percent retention of foreign currency by IT exporters abroad, and suggest facilitative measures to repatriate remittances to improve official reporting of IT/IT enabled services export revenues.
Earlier this year, Chinese Alibaba’s Ant Financial signed a deal with telecom operator Telenor for purchasing 45 percent stakes in Telenor Microfinance Bank at $184.5 million. The Alibaba Group uses Alipay as its online payment platform and the Chinese e-commerce giant will commence its digital financial services in Pakistan by the end of this year.
Ecommerce market stands at around Rs2 billion and 98 percent of online shopping is fulfilled through cash payment after shipping. Alibaba is currently in the process of acquiring approval from the SBP and the Competition Commission of Pakistan. The company will officially start its operations after getting formal approval from relevant regulators and departments.
Alibaba is looking to tap into the mobile payment financial services sector to facilitate individuals as well as small and micro businesses. Minister for IT and Telecom Khalid Maqbool Siddiqui, Law Minister Mohammad Farogh Naseem, secretaries finance, IT, cabinet and privatisation, and representative of State Bank of Pakistan and technical experts from the ministry of IT and telecom attended the meeting.

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