KARACHI: Raqami Islamic Digital Bank (RIDB) and Euronet Pakistan Pvt Ltd have entered into an agreement to promote digital payments in the country.
RIDB is one of five aspirants for the digital retail bank licence, which are to be awarded by the State Bank of Pakistan (SBP) under the Licencing and Regulatory Framework for Digital Banks (the Framework) 2022 and after incumbents achieve operational readiness and successfully conclude a pilot.
In January 2023 RIDB has obtained an NOC from the SBP to establish first Islamic digital retail bank in the country. In September 2023 SBP awarded in-Principal Approval (IPA) to Raqami and four other aspirants for the digital bank licence. Under the IPA, RIDB is in the process of developing its operational readiness for pilot, followed by commercial launch as a digital retail bank.
Under the agreement, Euronet Pakistan will be providing RIDB services such as Payment Switch, Card Management Solution, Credit Cards, ATM Controller, POS/E-Commerce Acquiring, Fraud Management Solution and Card Tokenization.
With the objective to have a robust, integrated, scalable and cloud-ready middleware platform Raqami will leverage Euronet’s system for integration between payment systems, core banking system, non-core applications, and digital channels. The move aims to build operational efficiency, reduced costs, improved service availability, and ensure a seamless digital banking experience for Raqami’s customers.
Addressing the signing ceremony, RIDB’s CEO Umair Aijaz said “the SBP’s systematic additions and enhancements to the digital ecosystem in the country are yielding undeniable dividends for Pakistan, as evidenced with the declining cash in circulation from Rs9,149 billion in June 2023 to Rs8,288 billion in the quarter ending September 30, 2023.
As Raqami prepares to launch as Pakistan’s first Islamic digital retail bank, we are committed to playing our part in this evolution. This exclusive agreement between Raqami and Euronet is a key partnership that will help set the foundation for the country’s first Islamic digital bank.”
CEO of Euronet Pakistan Kashif Gaya said they were excited to be selected by Raqami as their technology partner for card issuance, fraud management and transaction processing, and play a pivotal role in the launch of the first Islamic Digital Bank in Pakistan.
RIDB Coach Nadeem Hussain said that as part of a concerted drive by the Government of Pakistan to increase the availability and uptake of digital financial services in the country, the SBP has been spearheading numerous efforts.
The latest Quarterly Payment Systems Review Report shows remarkable progress, with digital transactions accounting for an estimated 80 percent of total retail transactions processed by Banks, MFBs and EMIs, with only 20 per cent accounted for by over the counter (OTC) transactions.
In this rapidly evolving ecosystem, Raqami believes the right partnerships will not only provide it with a viable starting point, but also enable it to rapidly achieve scale, while meeting the expectations of an increasingly digital savvy clientele, he added.
Copyright Business Recorder, 2024
Comments
Comments are closed.