Author: admin

ISLAMABAD:

Cabinet members have suggested that half of telecom spectrum auction proceeds should be deposited with the Universal Service Fund (USF), the entity responsible for developing digital infrastructure in the country.

The suggestion came in a recent meeting of the cabinet, chaired by the prime minister. While discussing the upcoming spectrum auction, the cabinet members suggested transferring 50% of proceeds from the spectrum auction to the USF.

The cabinet formed a committee, headed by the finance minister, to monitor the spectrum auction process. The committee will determine the percentage of spectrum auction proceeds to be allocated to the USF for nationwide tower fiberisation in support of digital infrastructure development.

The cabinet observed that the condition of mark-up – Karachi Inter-Bank Offered Rate (Kibor) plus 3% – for deferred payments was too stringent and should be revisited to bring it to Kibor plus 1%. Some cabinet members recommended that the terms of deferred payment should be relaxed by allowing the licensee to pay any percentage of the amount payable after one year of the issuance of a licence, with the remaining payment to be made in 10 equal annual installments starting from the second year of the issuance of the licence.

The cabinet was of the view that in order to ensure complete transparency, the proceedings of the spectrum auction should be broadcast live on all media channels, as was done during the recent privatisation of Pakistan International Airlines (PIA).

The Ministry of Information Technology and Telecommunication (MoIT) informed the cabinet that the proposal for the auction of licences of International Mobile Telecommunications (IMT) spectrum for the improvement of mobile services in Pakistan was aimed at increasing the speed of 4G by five times and that of 5G by 13 times.

The cabinet was told that according to the GSMA’s Mobile Connectivity Index Report 2023, Pakistan was ranked the lowest in South Asia in spectrum allocation, which was evident from the slow speed of internet and the proposed auction of spectrum would elevate Pakistan to a middle-tier country in terms of spectrum allocation.

The MoIT said that successful bidders would have the option to either opt for full upfront payment or go for deferred payment by releasing a minimum 50% payment by the first anniversary of the licence issuance date with the remaining amount payable in five equal annual installments from the second anniversary of the licence.

The cabinet was informed that the deferred amount would carry a cumulative mark-up of one-year Kibor plus 3% per annum and the spectrum licence fee would be specified in the licence in equivalent of Pakistani rupees instead of the US dollar.

Accordingly, the decision taken by the Economic Coordination Committee (ECC) was placed before the cabinet for ratification. Following consideration of a summary titled “Ratification of the Decisions taken by the Economic Coordination Committee,” the cabinet gave its nod for the ECC decision in respect of the “IMT Spectrum Auction for Improvement of Next Generation Mobile Broadband Services in Pakistan.”

The cabinet also constituted a committee, named the “Cabinet Committee on IMT Spectrum Auction for Improvement of Next Generation Mobile Broadband Services,” under Rule 17(2) of the Rules of Business, 1973, comprising the finance minister as convener and the economic affairs minister and IT minister as members.

The committee will steer and monitor the IMT spectrum auction process and streamline, if required, the payment terms, including the upfront payment structure, deferred payment options and installment arrangements.

According to the terms, the decisions taken by the committee will not require ratification of the cabinet in terms of the proviso to Rule 17(1)(c) of the Rules of Business, 1973. All bidding and auction processes to be carried out by the federal government or any of its entities will be broadcast live to ensure transparency.

KARACHI:

A few years ago, there was a debate over whether Pakistanis would adopt digital banking and, if so, how quickly — a common phenomenon in any society, as fear of the unknown often prevails before the acceptance of new ideas. However, following the Covid-19 lockdowns and support from international donor organisations such as the Bill and Melinda Gates Foundation, Pakistan has witnessed a tremendous rise in the use of advanced banking modes, with over 120 million customers now using mobile apps for personal and commercial transactions on a daily basis.

According to recent data released by the State Bank of Pakistan (SBP), more than 25.8 million customers of commercial banks were using mobile banking by the end of the first quarter of the financial year 2025-26. Customers of branchless banking using mobile apps surged to 87.9 million by the end of September 2025. In addition, customers of fintech operators were also on the rise, standing at 6.27 million by the end of the same period.

There are 34 commercial banks, 14 branchless banking operators and six fintech operators of Electronic Money Institutions operating in Pakistan, according to the Quarterly Payment System newsletter published by the banking regulator. These customers are utilising mobile banking for the transfer of funds, payment of utility bills, booking of tickets, online shopping, digital loans and credit, mobile top-ups and other services. Among them, a significant majority are using multiple mobile apps of different banking companies at the same time.

The growing utility of mobile banking apps among the masses in Pakistan reflects the increasing adoption of technological trends over the past few years, made possible by the rising use of smartphones and internet services, said Abdullah Tariq, a software engineer and mobile app architect.

He added that financial institutions, including banks and branchless banking operators, have invested heavily in the development of their mobile apps, particularly in customer interface and backend systems, resulting in improved customer experience, reliability and utility. The mobile apps empower users to transfer funds easily with a single click within a few seconds, significantly transforming the country’s banking landscape by enhancing transactions while saving time and cost for both customers and banking companies, Abdullah Tariq said.

With the emergence of digital banks and fintech operators, and their innovative services for earned wage access, digital insurance and digital investment, transaction values through mobile banking are expected to grow at an accelerated pace, he added. According to the SBP, a total of 2 billion transactions worth Rs337 trillion were made through mobile banking apps offered by banks, branchless banking players and Electronic Money Institutions. This accounted for 81% of all payments through digital channels, as total transactions stood at 2.5 billion during the period from July to September 2025.

These transactions include account- or wallet-initiated payments made by customers to merchants at both online and physical stores.

Ibrahim Amin, a banking and financial consultant, said mobile phone adoption by Pakistanis was greatly facilitated by the banking regulator in recent years through the launch of the RAAST payment system and QR payment options, enabling customers of banks and branchless banking operators to make instant financial transactions without any cost. He added that the role of branchless banking operators had enabled merchants, including shopkeepers and service providers, and their customers to use digital payments instead of cash.

He said customers of commercial banks generally made high-value transactions, whereas customers of branchless banking and fintech operators carried out low-value transactions. Ibrahim Amin, who is chairman of TriStar International Consultant, said he foresaw increasing use of mobile banking services in the future, as bank customers continue to adopt convenient and fast modes of banking and the country’s young generation remains tech-savvy, preferring mobile apps.

He noted that banks offering the best mobile banking experiences would attract more customers, underscoring the need for continuous upgrades of backend systems, including safety features. At the same time, customers must be educated to avoid scams in the future.

According to a report by the Asian Development Bank (ADB), only 21% of adults in Pakistan have access to a bank or mobile money account, amounting to approximately 91 million individual accounts as of 2025. In addition, companies, associations and non-governmental organisations also maintain accounts with banks.