- Digital banking and mobile payments are transforming financial accessibility despite persistent challenges
Interview with Mr. Rehan Ahmed Yousfi — Senior Regional General Manager, Faysal Bank
PAGE: Tell me something about yourself?
Rehan Ahmed Yousfi: I have completed my master’s programme in Islamic banking and finance from Karachi University, BSC honors in Economics, Maths and Statistics from Karachi University. Currently, I am working in the capacity of Senior Regional General Manager Faysal Bank which is the second largest Islamic Bank of Pakistan. It has been more than 20 years of diversified experience in banking sector.
PAGE: A substantial number of adult Pakistanis have been financially included over a decade in particular. Your perspective please:
Rehan Ahmed Yousfi: There is significant increase in financial inclusion over a decade in Pakistan as country has a population that is in excess of 240 million people. However, penetration in the financial sector is extremely low, having access to credit from formal financial sources. One of the major reasons for why large portion of population is unbanked is the lack of awareness of financial products and their usage. A large portion of population also lacks basic money and financial management skills. State Bank of Pakistan launched the Pakistan’s first ever Nationwide Financial Literacy Programme (NFLP) on 20th January 2012 to promote financial inclusion through spreading financial education for inclusive economic growth and stability across the country. The key objectives of the programme were to imparting knowledge and understanding of financial concept and development of skills which has created positive impact over a decade slowly but gradually.
PAGE: Is Pakistan financial services ecosystem still underdeveloped?
Rehan Ahmed Yousfi: Yes, Pakistan’s financial services ecosystem is still underdeveloped. The country has been slow to implement financial inclusion measures. Pakistan’s financial service ecosystem still faces significant challenges, despite some progress in recent years. The country’s financial sector is dominated by the banks with limited access to financial services, particularly for rural population and small business. The government has launched initiatives to promote financial inclusion strategy and has taken steps to improve the regulatory framework for financial services.
PAGE: How would you comment on financial inclusion for women entrepreneur?
Rehan Ahmed Yousfi: Financial inclusion for women entrepreneurs in Pakistan is crucial for promoting economic growth, reducing poverty and empowering women. Addressing the challenges faced by women entrepreneurs such as limited access to financial services, collateral requirements and high interest rates is crucial. Implementing targeted financials products and collateral free loans and leveraging digital financial services, we can increase financial inclusion for women entrepreneurs in Pakistan.
State Bank of Pakistan (SBP)’s Banking on Equality guidelines is a landmark framework focused to reduce the gender gap in financial inclusion by bringing a shift towards women friendly business practices in the financial sector.
PAGE: How has the technology helped in financial inclusion in Pakistan?
Rehan Ahmed Yousfi: Technology has played a significant role in financial inclusion in Pakistan. The state bank of Pakistan’s several initiatives to enhance digital financial services including the Raast P2P payment system, which enables individuals to send and receive funds using their mobile phone or internet banking. The SBP has also issued license to open five digital banks in this connection.
Despite this advancement there are still challenges to overcome, the lack of financial infrastructure in rural areas, limited digital literacy and socio-cultural norms that restrict women access to financial services are some hurdles that need to be addressed. But overall technology has been a game changer for financial inclusion in Pakistan offering unprecedented opportunities for people access to financial services and improve their economic well-being.