Filling vacuum: Telenor to bring online payment gateway this year

Published: May 2, 2014
Online retail: $10m is the current estimated size of the e-commerce market in Pakistan.  PHOTO: REUTERS/FILE

Online retail: $10m is the current estimated size of the e-commerce market in Pakistan. PHOTO: REUTERS/FILE


In a move that will benefit the country’s e-commerce, Telenor Pakistan is developing an online payment solution for the domestic market, which it expects to launch sometime this year.

“We are working on an online payment gateway, which will be based on our Easypaisa brand,” Telenor Pakistan Chief Marketing Officer Irfan Wahab Khan told The Express Tribune after speaking at a recent media roundtable about the company’s post-3G plans, the technology’s benefits to the country and the challenges facing the telecom industry.

Khan refrained from sharing any details, including the exact launch time, about the new product, but said the service would be available to Easypaisa mobile account holders and linked with 1Link – the ATM-based interbank payment network.

Telenor’s flagship mobile banking product, Easypaisa is the market leader in the segment – the platform has managed $3 billion or 1% of the country’s gross domestic product (GDP) in transactions since its launch, according to Khan.

Pakistani e-commerce (online retail) market is very sizeable already, he said, while rollout of 3G technology will spur its growth. There is no official figure available for the current size of this market segment but as per estimates of e-commerce companies the number is somewhere close to $10 million. Still there is a lot of room for growth.

Many countries including regional economies India and Nepal have access to PayPal – one of the world’s most widely used online payment gateways. Besides, PayPal, there are a number of other real-time payment systems, such as Google Checkout, Authorize.Net and Amazon Payments to name a few.

By contrast, there is no such platform available in Pakistan for online purchases – the e-commerce, therefore, depends mainly on cash-on-delivery (COD) model. In this system, customers make payment for online purchases at the time of receiving the product.

With the availability of an online payment gateway, consumers could make online payment for purchases ranging from airline tickets to apparel and mobile phones and anything for which vendors offer an online payment option, Khan said.

With third-generation (3G) mobile internet services expected to be launched this month, this seems to be a smart move by Telenor. The high-speed portable internet, according to industry experts, will trigger the growth of e-commerce in Pakistan.

Bangladesh, a regional country with similar market dynamics, saw its e-commerce grow by 50% within three months of the launch of 3G services.

The timing of launching a payment gateway will, therefore, be important as the company can benefit from an early entry into this segment just like it did with Easypaisa.

Telenor Pakistan, a subsidiary of the Oslo-based telecom giant, was the first player that had entered the mobile banking segment in 2009 through Easypaisa while other operators were skeptical – it is the market leader in mobile banking now.

Asked to comment on how this new product would contribute to the company’s revenues, Khan said, “telecom is a long-term business. For now, our focus is on bringing more people into financial inclusion and expanding market share.” The solution the company was developing would be similar to PayPal, he said.

An e-commerce player, who has already experienced the product during the testing phase, said the new system is an improved version of Easypaisa and more convenient for merchants. However, it is not truly a PayPal-like solution.

Published in The Express Tribune, May 2nd, 2014.

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Reader Comments (6)

  • Ahsan
    May 2, 2014 - 9:45AM

    Telenor Pakistan’s Easy paisa: Pioneer continuously leading the branchless/mobile bakning!


  • Asif H.
    May 2, 2014 - 5:21PM

    I sincerely hope it is not a copy of MCB lite.

    What the market needs is

    1)a way to charge any consumers Credit/Debit card and settle funds to merchant’s account.
    2)do the same to charge Credit Issues outside of Pakistan and settle their funds in USD

    Anything else is a waste of time in name of e-Commerce.


    Asif H.


  • Ali Khan
    May 3, 2014 - 11:20AM

    Two essentials of E-Commerce :
    1. Seemless and secure customer experience.
    2. Instant payment notification to merchant.
    Hope telenor lives upto expectation.


  • mythbuster
    May 11, 2014 - 6:12PM

    Unless someone or telenor makes a way around paypal for pakistanis than there is no real benefit in this.
    To some extent it will benefit us pakistanis. But the thing is that due to absence of paypal in pakistan billions of rupees is waste in exchange.

    I know that its not easy and blah blah blah. But telenor is big enough to make it happen.



  • Masood Ahmed
    May 22, 2014 - 12:13AM

    @Asif H.:
    Totally Agrred! We need a true payment gateway solution to be used at or ecommerce merchant websites.


  • Kashif
    Jun 2, 2014 - 6:56PM

    They don’t want that common man (like us) survive and improve their own life styles by positive means. Being an e-commerce researcher since 10 years, i know the importance of payment gateway for the people of Pakistan.
    The stupid example is the city bank merchant account, for this you need 1, 2 Lac in your pocket, otherwise they even not give you details of their merchant facility.

    So means elite class have rights to groom and improve their own life style. You know what if people of Pakistan will directly earn from foreign transaction via gateway then they can easily beat other countries. That’s what these people doesn’t want.

    Even the lower GDP countries like maldives have it’s own Payment gateway. So why not Pakistan ? Think people think …. Recommend

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