In the year and a half since microfinance bank FINCA Microfinance Bank teamed up with Fintech company FINJA to launch SimSim, Pakistan’s first digital mobile wallet product in July 2017, several other companies have quickly followed. Pakistan is undergoing something of a Fintech revolution of late, with mobile and digital wallets playing a central role.
Digital wallets have become popular in Western countries over the past several years with companies such as Paypal and Skrill (formerly Moneybookers) leading the way. Apple Pay and Google Wallet have also now entered field, along with many other providers. Initially, their utility lay in greater security around online payments. Debit or credit card details are only given to the wallet provider and not to merchants. However, mobile wallets are also now becoming a popular alternative to paying by bank card in a physical location. Touching a mobile phone to a contactless card reader completes a transaction. This also provides an additional layer of security, removing the worry of cards potentially being scanned and copied. A further advantage is that several cards can be linked to one wallet so the holder doesn’t need to carry them around.
In Pakistan, despite the fact that mobile and digital wallets have only been available for around 18-months, it is easy to argue that this Fintech development offers even more utility within the context of the local environment.
Still less than 20% of Pakistan’s adult population holds a traditional bank account and digital and mobile wallets are becoming a ‘catalyst for financial inclusion’. In 20015/16, 16% of Pakistanis had a traditional bank account and 3% a mobile wallet. However as per recent statistics by June 2017, there are over 27.3 million mobile wallet users with 87% year on year increase. A related study conducted by Karandaaz can also be reviewed here. That’s especially the case with mobile wallets, only readily available from local providers since mid-2017. They are faster (within 3 to 5 minutes), easier and more convenient to set-up and opening a digital wallet does not require visiting a bank branch. That is of particular convenience to more for rural populations for whom travelling to a physical bank regularly is often impractical. The security advantages that digital and mobile wallets have over debit and credit cards is also important.
Mobile wallets make particular sense in Pakistan when considered in the context that around 144 million Pakistanis are mobile phone users, over 40 million of whom also use them online, from a population of 200 million. That’s a far higher percentage of the population than have a traditional bank account. The digital payment system provided by mobile wallets is also much cheaper for providers to run, meaning that offering the service to users of limited finances can still be profitable.
The combination of these factors means that digital and mobile wallets are the perfect solution to help the wider Pakistani population graduate from a cash-only existence. Financial inclusion through mobile wallets reduces the risk of the user having money stolen as well as offering them the future possibility to access credit and other financial products that can help provide individual opportunities as well as drive the wider economy.
So, who are Pakistan’s digital and mobile wallet providers and what does their service provides?
1- Easypaisa by Telenor
Core Services: Bill payment, cash transfers, online retail, offline retail, salary disbursements, donations, social cash transfers, insurance and savings.
Additional Services: Inter-Bank Funds Transfer, online payments, handset lending and health insurance, purchasing airtime.
Merchants: 75,000+ [with 32% market presence as per study referenced]
Accessibility: Anyone – the service is not only available to Telenor subscribers. A mobile phone is not required and non-mobile digital wallet also available.
2- JazzCash by Mobilink
Core Services: Bill payment, cash transfers, online retail, offline retail, salary disbursements, donations, social cash transfers, insurance and savings, salary/corporate disbursements
Additional Services: Inter-Bank Funds Transfer, online payments, purchasing rail tickets, other tickets, passport fee payment
Merchants: 70,000+ [with 30% market presence]
Accessibility: Anyone – the service is not only available to Jazz subscribers. A personal mobile phone number is preferable as SMS notifications are provided on transactions.
3- Keenu Wallet
Core Services: Bill payment, cash transfers, online retail, offline retail, donations, social cash transfers, insurance and savings
Accessibility: Anyone – the service is open to anyone. A personal mobile phone number is preferable as SMS notifications are provided on transactions. A desktop digital wallet is available for those without a smartphone.
4- UBL – Omni
Core Services: Withdraw cash from ATMs, pay bills at ATMs, transfers, online and offline retail.
Additional Services: No name Visa Debi Cards
Accessibility: clients must visit an Omni Shop to set up mobile banking and receive a no name ATM debit card. The following will be required: Original CNIC, Yearly Service Charges: Rs. 150/-, Mobile phone number.
5- SimSim by Finja
Core Services: Bill payment, cash transfers, online retail, offline retail, donations, social cash transfers and savings.
Additional Services: Inter-Bank Funds Transfer, QR code payments, merchant locator app, payroll functionality for companies
Accessibility: Anyone. A smart phone is required.
6- uPaisa by Ufone
Core Services: Bill payment, cash transfers, donations, social cash transfers.
Additional Services: online payments, purchasing airtime, buy tickets, debit card
Accessibility: Users must be Ufone subscribers. A mobile phone is not required for money transfer or bill payment functions.
7- PayMax by Zong
Core Services: Bill payment, cash transfers, bank transfers
Accessibility: Bank account required as debit/credit card must be linked to PayMax App. Smartphone also required.
For a full review of all of Pakistan’s digital and mobile wallet providers and products, please consult the mawazna.com comparison service.
“Mawazna Karein Apne Liye, Apno key Liye”