Visa Inc, a global payments technology provider, is expected to launch its own mobile financial services (MFS) platform in Pakistan next year, according to Kamil Khan, Visa’s Country Manager for Pakistan and Afghanistan.
The players already operating in the mobile banking segment will be attached to Visa card, Khan told a group of journalists at a lunch at Sheraton Hotel on Wednesday.
“We are working with these companies [telecom operators and banks] and the product will be launched early next year or by the end of 2014, depending upon the latter’s readiness,” he said.
For example, he said, a single Mobile Point of Sale machine (mPoS) costs around $350, which requires hefty investment for deployment of such machines in rural areas. “We are working with these companies to launch cheap mPoS machines, which meet expectations of the regulator [State Bank of Pakistan],” he said.
Managing 24,000 transactions per second, Visa caters to more than 200 countries globally. The payments technology giant transacted $6.5 trillion over the four quarters ended March 31, 2013, which makes it the world’s largest retail electronic payments network.
Responding to a question about Visa’s revenue from Pakistan, Khan said, “We are growing along the lines of market growth – that is around 12%. We are in a leadership position with a sizeable market share in both debit and credit cards.”
Khan, who joined Visa in July 2012, oversees 25 client bank relationships and partners in Pakistan and Afghanistan, comprising a customer base of over 11 million Visa card holders.
Visa’s strategy for mobile banking in Pakistan is to collaborate with existing players instead of competing with them, he said while briefing the media about the company’s upcoming product. “We want to bridge the gap between banks and telecommunication companies and bring more people from cash to card,” he said.
The Express Tribune reported in its April 17 edition that the product would use VisaNet technology and function on the ‘interoperability’ model – a first in Pakistan’s mobile banking market. Fundamo, a wholly-owned subsidiary of Visa based in Cape Town, South Africa and a leading platform provider for mobile financial services, will launch this solution.
Visa entered the mobile banking segment earlier this year after Fundamo partnered with Monet to provide MFS platform for Warid Telecom and Bank Alfalah’s mobile banking solution. The company’s interest in further expansion comes on the back of a strong growth mobile banking has recorded recently.
Mobile banking has managed more than 31 million transactions worth $1.5 billion in the last quarter of 2012, according to the State Bank of Pakistan.
The SBP was one of the first in the world to introduce guidelines on branchless banking designed to encourage banks to roll out mobile financial services, according to Fundamo’s CEO, Hannes van Rensburg. Less than 10% of the population of 180 million had access to financial services back in 2008 while there were more than 94.7 million mobile subscribers.
“Despite increased adoption and use, the majority of Pakistanis remain unbanked,” Rensburg said. Only 12% of the population has access to formal financial services, he said, whereas mobile penetration is nearing 70%, indicating the huge room for growth in this sector.
Visa, as the country manager said, wants to bridge that gap between telecos and banks.
Published in The Express Tribune, May 30th, 2013.
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