Branchless banking has become most effective tool for the transparent and hassle-free disbursement of government financial support among the needy people as Government to Person (G2P) payments through branchless banking reached Rs 20.8 billion, up by 163 percent, during the first quarter of CY14. According to State Bank of Pakistan (SBP), G2P beneficiaries rose to 5.6 million by the end of the first quarter (January-March) of CY14.
Out of the total G2P accounts, card based beneficiaries reached 3.5 million and non-card based climbed to 2.1 million in number. During the quarter under review, some Rs 20.8 billion have been disbursed via BB channels for G2P beneficiaries, enormously higher than Rs 7.9 billion disbursed in last quarter (October-December CY13). The detailed analysis revealed that surge in G2P payments was mostly fuelled by Benazir Income Support Programme (BISP) payments. BISP has a 95 percent share in the overall payment of G2P and around Rs 19.6 billion have been disbursed during January-March through BB.
In addition to the regular G2P payments, the government also released relief payments of Rs 328.5 million for 51,000 BISP beneficiaries in famine-stricken Thar District of Sindh, Pakistan. Moreover Employees Old Age Benefits Institutions (EOBI) pensioners' payments worth Rs 485 billion were also made through branchless banking. Overall, the government disbursed Rs 48.18 billion in cash grants to 5.25 million beneficiaries on account of BISP during nine months (July 2013 to March 2014).
The programme has four closely associated and complementary components including Waseela-e-Rozgar (Technical and Vocational Training), Waseela-e-Haq (Microfinance), Waseela-e-Sehat (Life and Health Insurance) and Waseela-e-Taleem (Primary Education). Due to its wide coverage, the government allocated Rs 75 billion for BISP in budget FY15, hence more G2P payments via BB are expected during the year.
According to SBP even though account inactivity was prevalent in all types of BB accounts, however less than 1 percent of G2P accounts remained inactive during the quarter owing to the large flow of payments. In addition to UBL and Tameer's active G2P portfolio, during the quarter, Bank Alfalah, with its BB product mobile paisa has added over 947,000 BISP and Watan card beneficiaries, the SBP said. Furthermore, G2P deposits comprised of 80 percent of Omni's total deposits and 5 percent of Easy Paisa's total deposits. United Bank also disbursed relief payments for famine-stricken people of Thar which were reflected in the increased deposit balance.
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