Raising deposit to GDP ratio

The National Financial Inclusion Policy (NFIP) for the next five years approved by Prime Minister Imran Khan in the final week of November would focus on raising (i) the number of adults with a bank account from the current low 16 percent; and (ii) the number of women accounts from the current low of 11 percent. The Governor State Bank of Pakistan (SBP) Bajwa briefed the Prime Minister on the strategy.
It is relevant to recall that in 2015, Ashraf Wathra, the then Governor SBP, while delivering a keynote address on SBP's launch of the NFIP, stated that a broad-based consultative process was undertaken prior to finalizing the policy, including from the World Bank and the UK's DFID, and that "resolute efforts have been made to support the digitalization of payments and give depth to financial services among various segments of the population... the contribution of branchless banking is significant when it comes to channelizing government to person payments (G2P)", including Benazir Income Support Programme, Baitul Mal, Internally Displaced Persons and Watan Card holders - programmes whose allocations were raised which led to a percentage rise in deposits to GDP ratio. Wathra acknowledged the obvious linkage between these programmes (that led to a rise in NISP from 40 billion rupees in 2012-13 to 118 billion rupees in 2014-15), the rise in the GDP growth rate and the rise in revenue to the country's deposit to GDP rate. He added that "all actions covered by the comprehensive NFIS focus on reaching the poor and underserved clients (is)... consistent with the Government of Pakistan's Vision 2025 which calls for enhancing access to credit for SMEs and focuses on financial inclusion and deepening." Wathra then proceeded to strongly emphasise the need to include women into the financial sector and noted "the six Prime Minister's (Nawaz Sharif's) Youth Schemes introduced last year were also in line with this aim."
Disturbingly, the incumbent Governor SBP Bajwa did not mention whether SBP consulted other stakeholders and/or whether it bothered to contact the Ministry of Planning, Development and Reforms to try to integrate the Khan administration's economic vision into the NFIP. Bajwa reportedly also did not present any new initiatives to the Prime Minister and simply parroted the list of issues and recommendations noted during the tenure of the previous administration.
Additionally, Bajwa also failed to identify the NFIP linkages with other major macroeconomic variables with a low deposit to GDP ratio, including total allocations under P2G, and the impact of inflation on the rate of deposits as savers typically witness a decline in their bank balances as inflation rises (which is projected to rise in the current year due to not only higher budget deficit but also through higher price of oil in the international marketplace).
To conclude, at present there appears to be a proliferation of ad hoc decisions by entities that should be coordinating their actions in line with a clearly defined economic strategy followed by time-bound actions. While the Prime Minister is on record as having stated that some bureaucrats are impeding the way forward yet he must also accept that his government continues to defer decisions on economic reforms by failing to take bold policy initiatives based on out of the box solutions more than four months after it took over power. While one may understand delays in policy formulation in other sectors, yet the existing economic impasse clearly indicates that the government does not have the luxury of time and yet, to this date, the Khan administration continues to dither on the way forward.