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Innovative e-commerce keep advancing financial inclusion in Pakistan

In today’s context e-commerce is a potent tool to further the goal of financial inclusion by drawing more people within the digital financial services space, irrespective of income and social status. Through simple payment and delivery options, innovative e-commerce solutions have the potential to transform the overall consumer shopping experience and positively influence customer behavior change particularly with regards to moving away from cash, thereby encouraging traditional brick-and-mortar retail shops to expand their electronic presence. With foundations well in place for digital commerce to flourish in Pakistan, it is only a matter of time before e-commerce takes the Pakistani consumer market by storm.

Incorporate For a long time, no major e-commerce company has dared to set foot in Pakistan. However, there has been a drastic change in this perception. Large e-commerce portals, such as PakWheels.com, Zameen.com and Rozee.pk have changed the landscape of the e-commerce industry. This change may be rightly attributed to the emergence of 3G and 4G, which constitute 90% of Pakistan’s broadband base. E-commerce has a very important role to play in building an ecosystem of financial inclusion in general and mobile money solutions in particular: by leveraging the best of mobile technology to convert brick and mortar stores into electronic marketplaces, every individual can avail facilities that vary from bill payments to ordering physical goods. The key, however, is to extend appropriate financial and non-financial instruments based on customer buying patterns as and when the need arrives, at the same time creating effective use cases for other players to replicate and scale.

The size of e-commerce market, one of the most important drivers of a digital Pakistan, is expected to grow up to US$1 billion by 2020 which presently falls between US$70-150 million. The regulations regarding Framework for Payment System Operators (PSO) and Payment Service Providers (PSP) have been devised and approved by State Bank of Pakistan (SBP) while development of E-commerce Policy Framework is also under process to cater to all elements of user, merchant trust with dispute resolution and remedial mechanisms. The most important element of the e-commerce ecosystem is Payment Gateway that will enable entry of credible international players in e-commerce ecosystem of Pakistan and will resolve longstanding barriers to growth of Pakistani e-commerce market. The recent policy and regulatory development have paved the way for credible international players to enter into Pakistan’s e-commerce market.


Pakistan is generally a cash-driven economy as number of debit/credit card holders is small and m-wallet accounts are also very low due to which more than 95 percent of the e-commerce transactions are done by Cash on Delivery system. Pakistan’s share in the global IT sales is just US$2.8 billion out of global US$3.2 trillion global market. However, Pakistan is making good progress on Business to Business (B2B) front as software industry aims to achieve the goal of US$5 billion export mark by year 2020. Furthermore, the IT industry has various medium-sized IT firms earning nearly US$530 million, mainly in software development and service out-sourcing. Consumer buying trend in Pakistan is not just limited to buying products online, there are also websites for cars, property and travel which shows that consumers in Pakistan are using internet to experience a wide range of economic activities.

According to McKinsey & Company, a worldwide management consulting firm, fintech will add about 4 million jobs, 93 million bank accounts, $36 billion annually to the gross national product (GNP), and $7 billion to Pakistan government’s net revenue by 2025. Bank accounts seem to be on track as there are 7 million today. This includes 1.8 million traditional accounts, accumulated over 50 years, and 5.2 million mobile/branchless accounts accumulated in around one-tenth of that time. This is because globally, traditional bank accounts rise proportionately to GNP, but mobile accounts can rise exponentially. Transactions worth Rs20.7 billion were carried out by consumers on international e-commerce websites.

It is apparent that e-commerce has taken root in Pakistan nested within an environment conducive for further growth. As mobile phone adoption rises with smartphones becoming more affordable, maturing 3G/4G telecoms services and rapid growth of mobile money solutions, along with extensive wireless coverage, innovative initiatives like daraz.com.pk and online selling in general are set to lead customer behaviors and influence retail trends in Pakistan.

The writer is a Karachi based freelance columnist and is a banker by profession. He could be reached on Twitter @ReluctantAhsan

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