In a development that waves on the Pakistan Fintech panorama earlier this month, Google finally launched its wallet service there. The digital payment solution of the technological giant, which allows users to store payment cards virtually on their Android devices, got excited about LinkedIn’s thinking leaders. The feed was flooded with publications and images of how this singular event would change the course of the Pakistan digitalization trip as nothing we have seen before.
But beyond the intellectual regurgitation of LinkedIn’s self -promotion, what exactly does this launch for the country’s payment ecosystem mean? Is this really as revolutionary as the applicants tell us influential people? Or simply another launch of minor products? The answer, as is the case with the adoption of technology in emerging markets, is at some intermediate point.
To start, Google’s entry is in fact a welcome development. After all, Pakistan was probably the largest country that did not have this service. Before entering that, let’s first understand what the product is and not.
Essentially, the wallet touches and digitizes its existing debit and credit cards, which allows users to simply touch their phones in NFC [Near field communication] -The point of sale terminals enabled to pay things. The convenience factor is undeniable, since it eliminates the need to transport bulky wallets, but for now, it is only for Android users.
However promising, its current universe is quite limited since it serves only payment cards, of which there are 56.4m in Pakistan
“The launch of Google Wallet is a sign of how much the country’s digital economy has evolved and indicates the potential of the market. The greatest benefit is for the client, since it makes the entire transaction of the point of sale more perfect. In fact, we have seen in countries such as the EAU and Saudi Arabia how the launch of Apple Pay significantly increases transaction volumes.
“We hope that Pakistan will undergo a change similar to that which the Google brand brand should help familiarize customers with mobile phones payments and create trust among all parts. That would also help accelerate the absorption of Rast P2M [peer to merchant]”Says Saad Niazi, executive director of Keenu, an electronic money institution and an important point of sale acquirer.
The second point perhaps deserves a deeper emphasis. While the Rast P2M module was launched at the end of 2023 and, according to the reports, saw the incorporation of an exceptional merchant since then, the adoption has not yet accelerated the rhythm. According to the latest review of Payments Systems, 0.9 million transactions worth RS2.9 billion took place between September and December 2024.
On the other hand, hundreds of millions of digital transactions in physical stores take place through pairs. Just remember how many times you have paid for Careem through the transfer of RAST or interbank funds, although it was for a commercial purpose. By embeding a convenient functionality of Tap -to-Pay, Google Wallet, given its brand, you can create a change of behavior among customers to the various new technologies such as requesting payment and scanning and payment, among others.
However promising, the current universe of Google Wallet users, however, will be quite limited. Since the offer is limited to only cards, it adapts only to payment cards, of which there are 56.4m in Pakistan. On the other hand, most digital payment adopters use mobile applications of players without branches such as jazzash and Easypaisa (now a digital retail bank), which numbers almost 64m and another 21 million through the programmed banks.
There is absolutely no comparison between quantum, either by yield or volume, between cards based on cards and mobiles.
“There is no doubt that Google Wallet that arrives in Pakistan is a welcome sign that the great global players are now analyzing the enormous and growing Pakistan market to allow digital payments. However, there is more to do. The growth model for digital payments in Pakistan should consider the global south as an example.
“The interface of unified payments in Brazil and India has shown that the payment infrastructure from person to person and from person to merities, if they are carried out correctly and support for a sustainable policy, can eclipse traditional payments based on traditional cards for which expensive infrastructure is needed,” says Karim Jindani, executive director of the laboratories of Pays. Leading payment technology.
Even when we ignore how most digital transactions in Pakistan originate in applications and limit ourselves to a relatively smaller card universe, there is another problem. Google Wallet takes and pays, which requires NFC availability. As happens, most local phones do not have that functionality, partly because national assemblies deliberately reduce the characteristics to save costs.
Although there are no data that points to its extension, it is unlikely that the proportion of smartphones with NFCS will exceed a fifth. However, this is perhaps only a short or medium term challenge, since the additional cost of adding NFC on smartphones is quite low for assemblies. When there will be demand, they will answer. On the acquirer side, most point of sale operators have recently updated their machines and now admit the card based on the card.
In any case, the emitters are excited, if it was not clear from LinkedIn. “For Jazzash, Google Wallet represents an interesting opportunity to expand our card footprint at a predominantly mobile first -mobile customer base,” says Aamir AFTab, Jazzash products director. “While our customers of more than 13 million interact mainly through our mobile application for wallet -based transactions, integrating with Google Wallet allows us to encourage card adoption and at the same time allow you to take advantage of smartphones.”
For the most part, the Pakistan Fintech ecosystem will forge its own trajectory, more molded by local innovations that address our unique problems or by solutions that adapt to those needs.
The writer is the co -founder of Data Darbar
Published in Dawn, The Business and Finance Weekly, March 31, 2025
