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MPA (400+ posts)
On 1st November, 2019 Governor State Bank of Pakistan Dr. Reza Baqir launched the National Payment Systems Strategy.
Financial Market Infrastructures (FMIs) that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy. Central banks typically seek efficiency and safety in the National Payment Systems (NPS), including retail payment systems, services and payment instruments. In this context, SBP through World Bank’s Financial Inclusion Support Framework (FISF) program, prepared a strategy for the Pakistan’s NPS which would support both the National Financial Inclusions Strategy (NFIS) and the financial stability of the country.
The objectives of this strategy are to make recommendations to design a NPS complying with international standards and best practices, and tailored for the specific circumstances and needs for a safe, efficient and inclusive NPS in the country. The dual objective of enhancing financial stability to contribute to economic growth and of supporting financial inclusion are the overarching goals of this strategy.
THE NATIONAL PAYMENT SYSTEMS STRATEGY
Financial Market Infrastructures (FMIs) that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy. Central banks typically seek efficiency and safety in the National Payments System (NPS), including retail payment systems, services and payment instruments. More recently, accessibility, the effective protection of customers and the existence of a competitive environment are also being considered as important objectives by many central banks. The objectives of this National Payments System Strategy are to make recommendations to design a National Payments System complying with international standards and best practices, and tailored for the specific circumstances and needs for a safe, efficient and inclusive National Payment Systems in Pakistan. Migration to efficient electronic payments stimulates consumption and trade, bringing benefits to the whole economy. By migrating to electronic means, the strategy intends to boost Pakistan’s GDP by 7%, creating 4 million jobs, resulting in $263 billion in new deposits, representing a potential market of $36 billion, all by 2025.
Furthermore, financial market infrastructures that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy.The dual objective of enhancing financial stability to contribute to economic growth and of supporting financial inclusion are the overarching goals that guide the recommendations presented in this document.
The strategy for Pakistan’s National Payment System is based on applicable international standards, particularly the CPMI-IOSCO PFMIs, as well as the analytical framework defined by the CPMI-World Bank for Payment Aspects of Financial Inclusions (PAFI). The foundations – commitment from stakeholders, the legal and regulatory framework, and financial and ICT infrastructures – are the critical enablers for payment systems and the provision of payment services in general. Specifically, they are important for the access to and usage of transaction accounts. Based on these, the catalytic pillars – i.e. payment product design, the ease with which accounts can be used, financial literacy, and leveraging large-volume recurrent payment streams for financial inclusion purposes – form the drivers for access and usage.
The strategy addresses a wide range of topics covering the entire National Payments System: the critical foundations, including the Legal and Regulatory Framework and the NPS Infrastructure. The strategy then continues with the characteristics of Pakistan’s Retail Payments Market, the issues of account and payment product design, and access points. Oversight of the National Payment system is specifically identified as a key area of focus and a pivotal responsibility of the Central Bank. Finally, large-volume recurrent payment streams are identified and recommendations on how to leverage them are provided, starting with government payments and ending with national and international remittances.
Source
Financial Market Infrastructures (FMIs) that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy. Central banks typically seek efficiency and safety in the National Payment Systems (NPS), including retail payment systems, services and payment instruments. In this context, SBP through World Bank’s Financial Inclusion Support Framework (FISF) program, prepared a strategy for the Pakistan’s NPS which would support both the National Financial Inclusions Strategy (NFIS) and the financial stability of the country.
The objectives of this strategy are to make recommendations to design a NPS complying with international standards and best practices, and tailored for the specific circumstances and needs for a safe, efficient and inclusive NPS in the country. The dual objective of enhancing financial stability to contribute to economic growth and of supporting financial inclusion are the overarching goals of this strategy.
THE NATIONAL PAYMENT SYSTEMS STRATEGY
Financial Market Infrastructures (FMIs) that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy. Central banks typically seek efficiency and safety in the National Payments System (NPS), including retail payment systems, services and payment instruments. More recently, accessibility, the effective protection of customers and the existence of a competitive environment are also being considered as important objectives by many central banks. The objectives of this National Payments System Strategy are to make recommendations to design a National Payments System complying with international standards and best practices, and tailored for the specific circumstances and needs for a safe, efficient and inclusive National Payment Systems in Pakistan. Migration to efficient electronic payments stimulates consumption and trade, bringing benefits to the whole economy. By migrating to electronic means, the strategy intends to boost Pakistan’s GDP by 7%, creating 4 million jobs, resulting in $263 billion in new deposits, representing a potential market of $36 billion, all by 2025.
Furthermore, financial market infrastructures that facilitate the clearing, settlement, and recording of monetary and other financial transactions can strengthen the markets they serve, play a critical role in fostering financial stability and hence contribute to a strong economy.The dual objective of enhancing financial stability to contribute to economic growth and of supporting financial inclusion are the overarching goals that guide the recommendations presented in this document.
The strategy for Pakistan’s National Payment System is based on applicable international standards, particularly the CPMI-IOSCO PFMIs, as well as the analytical framework defined by the CPMI-World Bank for Payment Aspects of Financial Inclusions (PAFI). The foundations – commitment from stakeholders, the legal and regulatory framework, and financial and ICT infrastructures – are the critical enablers for payment systems and the provision of payment services in general. Specifically, they are important for the access to and usage of transaction accounts. Based on these, the catalytic pillars – i.e. payment product design, the ease with which accounts can be used, financial literacy, and leveraging large-volume recurrent payment streams for financial inclusion purposes – form the drivers for access and usage.
The strategy addresses a wide range of topics covering the entire National Payments System: the critical foundations, including the Legal and Regulatory Framework and the NPS Infrastructure. The strategy then continues with the characteristics of Pakistan’s Retail Payments Market, the issues of account and payment product design, and access points. Oversight of the National Payment system is specifically identified as a key area of focus and a pivotal responsibility of the Central Bank. Finally, large-volume recurrent payment streams are identified and recommendations on how to leverage them are provided, starting with government payments and ending with national and international remittances.
Source
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