Transcript Presentation

ITU Workshop on Digital Financial Services and
Financial Inclusion
14 December 2015
Geneva, Switzerland
Interoperability: A Synopsis of
Pakistan’s Experience
Syed Sohail Javaad
Additional Director, State Bank of Pakistan
[email protected]
Pakistan – Demographics & Institutions
Surface Area:
Population
GDP (FY 15):
Per Capita Income:
Total Labor Force:
Population Distribution
Urban
Population
(35%)
Rural
Population
(65%)
796,095 Sq. km
190 million
USD 270 billion
USD 1427
55.4 million
Financial Inclusion
1Link Provides Interoperability to
banks for ATMs and Inter Bank Fund
Transfer (IBFT)
23%
12%
2008
2015
Branchless Banking
Digital Financial Inclusion
•
•
•
•
Enabler of Financial Inclusion but…
80% of transactions are Cash in Cash Out (80%) only 20% are through m-wallets
The share of Telco dominated BB platform is 80% in transaction and agents
Lack of Interoperability in Branchless Banking
Interoperability and its Levels*
Interoperability at platform and customer level doesn’t exist
*Defined by CGAP.
Picture credit: CGAP
Challenges for Interoperability
• Reluctance of MNOs to share
– Fear of cannibalization?
• Lack of regulatory framework
– Balanced regulatory approach may be required
– USSD and SMS channels for financial services by Telcos
• Non-collaboration between banks & MNOs
– Non availability of financial products at MNO level
• Interchange?
Can good regulations improve the situation?
Regulations
Rules for Payment System Operators (PSOs) and Payment Service
Provider(PSPs)
•
•
Allows private sector non-banks to establish Payment Systems
To be authorized by SBP Authorize Financial Institutions (AFIs)
Draft Regulations for Branchless Banking Interoperability
•
•
•
Allows establishment of new class of Third Party Interoperability Service Providers
(TPSPs) to be licensed by Pakistan Telecommunication authority (PTA) for branchless
banking
Power of SBP to Authorize Financial Institutions (AFIs) to enter into agreement with
TPSPs for interoperability
Defines the roles and responsibilities of TPSPs and AFIs
–
–
–
•
Sharing of fee/revenue and liability
Consumer Protection, Dispute Resolution
Service Standards
The arrangement to be jointly regulated by PTA and SBP
Future Prospects
Youth Population
NADRA Database
Majority of population consists of young people
• 40% are under age group 20
• 22% lie in the age group 20-34
NADRA’s has one of the largest, fully integrated databases in
the world
• More than 95 million CNIC issued
• Supports biometric verification for account opening
3G/4G spectrum auction in 2014
3G/4G Spectrum
Supportive Regulatory
Environment
• 20 million 3G/4G subscribers in one year
• 100 mn mobile phones sets with 31% being Smartphone
Widely recognized regulatory framework that support
• Interoperability
• Flexibility of BB models
• Prospects of licensing e-money issuers under PS&EFT ACT 2007