Karandaaz supports State Bank of Pakistan to launch Pakistan’s Instant Payments System ‘Raast’
Karandaaz supported Instant Payment System for Pakistan ‘Raast” was launched at a high-level event attended by the Prime Minister of Islamic Republic of Pakistan, Imran Khan; UN Secretary-General’s Special Advocate for Inclusive Finance for Development, Queen Maxima of Netherlands; British High Commissioner to Pakistan, Dr. Christian Turner CMG; Governor State Bank of Pakistan, Reza Baqir; and CEO Karandaaz Ali Sarfraz. Co-chair Bill & Melinda Gates Foundation, Bill Gates sent a special video message for the launch read by the CEO of the Bill & Melinda Gates Foundation Mark Suzman. This instant payments system is a core component of the National Financial Inclusion Strategy to significantly augment prospects of digital financial services and increase financial inclusion to 50% of the adult population in the country, reduce reliance on cash and drive the provision and uptake of digital payments, especially among low-income households and small merchants. Raast will enable transfer of payments digitally in a fast, low-cost, and secure manner. Raast will also make it possible for banks and other payment service providers to offer more innovative products and services and revolutionize the digital financial landscape in Pakistan.
UN Secretary-General’s Special Advocate for Inclusive Finance for Development, Queen Maxima of Netherlands said,
I am delighted to be here today for the launch of the pro-poor Micropayments Gateway, Raast, and to congratulate you on the draft ‘Banking on Equality Policy’. These are important milestones on the journey to a more inclusive financial system and to a digital economy that works for everyone. This is particularly significant for vulnerable segments—such as women and the poor, and especially during this Pandemic. These groups have been disproportionately affected by COVID-19, in part because they were already underserved prior to the pandemic. Based on the last Global FINDEX data from 2018, men in Pakistan were roughly five times more likely than women to have an account and, of the poorest 40% of the population, just 14% had an account. We know that financial inclusion has a pivotal role to help people deal with the health and economic crisis caused by COVID-19, and to assist them in exploring new opportunities. So these figures provides us an indication of the challenges lying ahead.
In his message read by the CEO of the foundation Mark Suzman in a recorded video, Bill Gates, Co-Chair of Bill & Melinda Gates Foundation said,
Pakistan has achieved an impressive reduction in extreme poverty but there is so much more work to do to ensure more people have the chance to live a healthy and productive life and are included in the economy. That is why I am thrilled that Raast is launching after so much hard work and collaboration between the State Bank and our partner Karandaaz. I hope that in years to come, we will look back and see this new digital public good as an important contribution to our shared goal of giving all people the tools they need to lift themselves out of poverty. Our foundation is happy to support efforts towards accelerating digital financial inclusion in Pakistan just like our efforts to eradicate polio and for the Ehsaas poverty alleviation program. Thank you and congratulations on a successful launch.
Speaking about the instant payments system, Chairperson Karandaaz Pakistan, Dr. Shamshad Akhtar said,
Over the coming months, Raast will gradually expand use cases as it resolves the challenges such as complex, cumbersome, and time-consuming integration of digital payments, and constraints posed by limited direct debit facility and enable the central bank’s system to offer bulk credit services, open APIs that will result in alias based payments allowing account agnostic push-based instant transactions. All these features will help generate more innovation in the digital financial services sphere and we are hopeful that Pakistan will soon achieve the goals set in the National Financial Inclusion Strategy. Raast is an ISO 20022 format compliant system and allows new products and services which were previously hampered due to legacy messaging. This milestone achievement will have a ripple effect and positively influence multiple other Sustainable Development Goals in the country due to its positive impact.
Raast will be at the center of the digital payment ecosystem in Pakistan and will connect merchants, businesses and SMEs, and consumers to banks, microfinance banks, fintechs, payment service operators and providers, and government entities. This connection that is currently missing will be possible through the internet, phones, mobiles, and agents now that a central payments gateway to make high volume low value digital payments possible has been put in place.