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Raast: takes another success in Pakistan

Raast: takes another success in Pakistan

Newfound system helps facilitate P2P transactions

Imran Khan, Prime Minister of Pakistan launched the second phase of Raast, called Person-to-Person instant payment system in a ceremony in Islamabad. Raast, a flagship initiative of the State Bank of Pakistan (SBP) is a payment system platform that enables various types of transactions among different stakeholders such as organizations, businesses and persons.

The objective of this initiative is to promote digitization and financial inclusion in the country. In the first phase of Raast, launched in January 2021, transactions from organizations to persons, generally referred to as Bulk Payments, were enabled. The second phase is designed to facilitate Person-to-Person (P2P) transactions under Raast.

Prime Minister congratulated Governor State Bank of Pakistan (SBP), Dr. Reza Baqir and his team for the successful completion of the second phase. He was addressing a gathering of Ministers, Presidents of Banks, SBP officials and other distinguished guests at the Prime Minister House in Islamabad.

He appreciated that the newly launched system which will enable ordinary people to execute digital payments instantly, securely, and conveniently without paying any fee and added that Raast will open doors of further innovation for the economy and particularly the financial sector. He expressed his confidence that through digitization of the economy, the over 220 million population could be converted into an asset by ensuring their financial inclusion.

Speaking on the occasion, Minister for Finance and Revenue, Shaukat Tarin appreciated the SBP for the progress made in digitization and expressed his confidence that the forthcoming phases of Raast including payment to merchant will play an important role in facilitating the masses in their financial transaction thus increasing their valuable contribution in the economy.

Governor, Dr. Reza Baqir welcomed the Prime Minister on the launch event and expressed gratitude for his commitment and support to the SBP initiatives for promoting digitization and financial inclusion in the economy. Governor Baqir, while highlighting the key features of Raast, explained that individuals can use this platform in their transactions just like cash and they will not have to pay any fees or charges for using this payment system. More importantly, Raast is secure and convenient and free of risks compared to cash. Raast is easy and simple to use as it allows connecting bank account to user’s mobile number, called Raast ID. The facility can be used on mobile apps and internet banking portals of banks. For those people who do not have a mobile phone or facility of internet banking, Raast P2P service is also available in bank branches.

To avail Raast, customers should check SBP’s Raast landing page to see if their bank is already offering Raast—currently more than 18 banks, processing majority of retail payment transactions, are offering Raast services —and register one time for Raast in their bank’s mobile app, through internet banking or by visiting a bank branch. Remaining banks are expected to be on boarded with Raast in the coming weeks.

Dr. Baqir explained that Raast is Pakistan’s first instant payment system established in accordance with the National Payment Systems Strategy, which was prepared by State Bank of Pakistan and launched by the President of the World Bank in 2019 when he visited Pakistan. This project is a major initiative of State Bank of Pakistan, and with the launch of Raast, Pakistan is now in an exclusive list of countries that have state of the art instant payment system. He assured that SBP is committed to launching more innovative features in Raast to further promote digitization and financial inclusion.

On SBP’s efforts to promote digitalization of payments and economy, Governor SBP highlighted that in January SBP issued digital bank licensing framework that provides flexible requirements to setup digital banks in Pakistan. For now, only five licenses for Digital Banks will be issued and interested parties can apply for a license until March 31, 2022.

It may be noted that during fiscal year 2021, 1.2 billion transactions valued at US$500 billion were processed through retail e-Banking channels. These transactions showed year-on-year growth of 30.6% in volume and 31.1% in value.

In Pakistan, there is a common trend that people don’t rely on technology. Call it lack of awareness or non-inclusivity in the existing culture but people are not very prone to using digital tools and banking systems for their ease. Prime Minister said, “Common people are afraid of going to banks. Using this system, a common man can transfer money through his phone instantaneously.”

In his speech, he also paid a tribute to the State Bank of Pakistan which has developed this system. He said that State Bank has been able to facilitate overseas Pakistanis, who are the biggest asset of Pakistan, by involving them in Roshan Digital Pakistan. This program is further supposed to assist them in the transfer of money.

The Governor of the State Bank of Pakistan, Dr. Baqir made it clear that this system is working only in a few countries and will be totally free of cost to be used by any citizen. He said that people should start using it for their payments.

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