The collaboration paves the way to create a more financially inclusive ecosystem for customers and businesses by enabling users to access a comprehensive array of digital financial services, including a fully operational business bank account, payroll, reporting, analytics, and expense management.
YAP customers will also be able to access over-the-counter services at Bank Alfalah’s network of branches across Pakistan.YAP Pakistan secured the In-Principle Approval from the State Bank of Pakistan for an Electronic Money Institute (EMI) license, which will equip users with a digital account and an app that will enable users to perform various financial tasks at the touch of a button.
Bank Alfalah has been on the mission to collaborate with various partners in a bid to increase the adoption of digital payments in the industry. Bank Alfalah’s Cash Management enables Corporate, Middle Market, and SME clients to prepare their payment and transfer instructions to the bank in real-time.
SMEs contribute to 40% of Pakistan’s GDP and 25% in overall exports, which emphasises the demand for an easier way to manage finances when in the early stages of growing a business.
SMEs are progressively being perceived as productive drivers of economic growth and improvement for African nations. SMEs contribute essentially to the economy as well as fill in as a catalyst for economic expansion through their improvement of new and unsaturated segments of the economy.
SME part in Pakistan is a less formally sorted out division; more than 96% organisations are possessed and overseen by a person as a sole restrictive concern. While 2% are associations, there are not really any corporate substances in the SME area, suggesting that the consideration of expert individuals in business administration process is yet to be seen.
Pakistan is still behind its neighboring countries like China, Iran, and India as investors from the world are more likely to invest in neighboring countries rather than Pakistan.
Pakistan is an emerging economy at a critical stage of its economic modernisation. Annual GDP growth is sitting above 4%, though concerns over inflation have led to calls for additional reforms and initiatives that put economic growth at the heart of the agenda. It is partly the reason why the State Bank of Pakistan (SBP) is looking to digital challenger banks as part of a long-term economic strategy.
Now, only 21% of the adult population in Pakistan are bank card owners, compared to 50% in Bangladesh and 80% in India. The reasons for this range from accessibility of branches to strict lending and credit regulations currently in place by the major banks. Moreover, only 3% of adults in Pakistan borrow from a formal channel, with more than 30% instead borrowing from family, friends, or semi-formal processes.
Therefore, emerging markets like Pakistan are ideally positioned to benefit from fintech innovations – they must constantly ensure everything is being done across the private and public sectors to encourage fintech adoption. Doing so will digitally empower a new generation of consumers, investors, and businesses, who in turn, can fulfill their full potential.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now