Hajra Naz
Fintech is one of the fastest-growing areas in the financial world. It helps connect people who don’t have access to banks with the banking system. With its innovative services, fintech has the potential to bring big changes to Pakistan’s financial landscape. However, the competition among players has significantly intensified in 2024, leading to noteworthy developments.
Mergers and Acquisitions
- ABHI’s Landmark Acquisition
ABHI became the first fintech operator in Pakistan to acquire a foreign microfinance bank, FINCA Microfinance Bank, in collaboration with TPL Corporation. This move, approved by the banking regulator, marks a milestone for the sector, setting the stage for future mergers and acquisitions. - Finja’s Exit and OPay’s Expansion
Finja, a pioneering fintech company that began operations in 2021, surprised the industry by selling its operations to OPay in 2024. Finja had obtained dual licenses for digital wallets and SME lending, growing steadily over the years. Its exit underscores the evolving dynamics of the fintech landscape in Pakistan.
Arrival of New Players
- Cerisma’s Entry
A license to function as an Electronic Money Institution (EMI) was granted to Cerisma, a division of Pakistan State Oil (PSO). It plans to introduce e-money wallets for both customers and merchants through its vast network of more than 3,500 locations. - Toko Lab’s Approval
Toko Lab received in-principle approval to launch its e-money wallet services in 2024. - EduFi Financial Services
EduFi entered the market under a Non-Banking Financial Company (NBFC) license, focusing on providing student loans with flexible repayment terms. - Neem Exponential Financial Services
Neem introduced earned wage access and raised significant funding to support its launch. - Withdrawals from the Market
CMPECC is among the fintech operators that rolled back their operations in Pakistan.
Expansion of E-Processing Systems
E-Processing Systems, a subsidiary of Systems Limited, started offering e-money wallet services to consumers, merchants, and agents. Additionally, Akhtar Fuiou Technologies and Hubpay were granted permission to launch pilot operations.
By the end of 2024:
- Five fintech operators will be providing commercial services.
- Three operators are in the pilot phases.
- Three others have received initial licenses.
- Four operators have exited the market.
Pakistan at the Singapore Fintech Festival
In a significant move, ten Pakistani tech companies participated in the Singapore Fintech Festival 2024. This participation highlights Pakistan’s growing presence in the global fintech landscape.
- ABHI’s CEO, Omair Ansari, was invited as a guest speaker to share his success story.
- Hakeem Tech received a cash award for exceptional services.
SECP’s Updated Fintech Operator List
The list of fintech companies licensed by the Securities and Exchange Commission of Pakistan (SECP) under the Non-Banking Financial Company (NBFC) framework has been updated.
- Nine operators, including JazzCash, are authorized for digital lending.
- Eight operators are offering services like Earned Wage Access (EWA), B2B financing, and Pay Later solutions.
Looking Ahead to 2025
In 2025, the competition in Pakistan’s fintech industry will only get more fierce, especially in fields like e-money wallets, digital financing, and buy now, pay later options. In this quickly changing market, operators who offer excellent and innovative services are likely to gain a competitive edge.
