Muneeb ur Rehman

Though Pakistan’s financial sector is embracing technological know-how with some speed, bottlenecks are still there that need to be addressed for its robust growth, stresses Omer Ahmed, the Chief Executive Officer of Avanza Solutions Private Limited, a Karachi-based digital solutions provider. “Lack of access to the internet in rural areas of the country remains a primary challenge. People in the countryside are disconnected from technology and are unable to reap the benefits of financial products and services,” he underscored while talking to WealthPK.

He said that cyberattacks on digital systems were creating mistrust in the minds of people making use of financial technology. “Customers are always conscious about the protection of their personal and financial data. The absence of a strong cybersecurity system is also a major hindrance to let people enter the financial ecosystem,” he continued. Omer Ahmed said that a strong cybersecurity system would encourage the fintech investors to penetrate the local market.

Another challenge faced by the country is the low level of digital literacy, evident from the Global Financial Literacy Survey's report stating that Pakistan's financial literacy rate is merely 26%. “There should be a concerted effort to increase digital literacy among people to give a fillip to the digital payment ecosystem. People should be acquainted with the use of different digital services being offered by the fintech firms,” he highlighted.

Omer Ahmed also stressed the high rates of internet in those areas where the private sector was yet to have its footprint. “Despite massive penetration of smartphones, the fintech sector has not achieved comparable growth in most areas of Pakistan due to high cost of internet.” He asserted that providing space to the private sector to lay down its infrastructure would help create a competitive market for internet services, leading to affordable rates.

Omer Ahmed also highlighted the fact that local culture was also responsible for slow growth of fintech sector. “People in Pakistan are in the habit of making payments through hard cash. They show a great degree of mistrust in technology.” He said fintech sector was reshaping the way people used to do financial transactions through traditional means. “Promotion of fintech sector by removing bottlenecks can help the government efficiently run cash transfer programmes besides attracting investment in the sector,” he added.

Credit: Independent News Pakistan-WealthPk