SBP reduces fees to improve Pakistan’s digital payment infrastructure.

SBP reduces fees to improve Pakistan’s digital payment infrastructure. In order to improve the digital payment infrastructure in Pakistan, the State Bank of Pakistan has decided to facilitate the Point of Sale (POS) acquiring industry.

The State bank pointed out that there has been considerable growth in the digital payment infrastructure of the country, especially in the number of debit cards being issued by the banks to their customers in past years.

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“Although, the Point of Sale (POS) infrastructure has also grown during the past few years, its growth has largely remained restricted to high value merchants in big cities. Some of the key challenges being faced by the POS acquiring industry in Pakistan include high Interchange Reimbursement Fee (IRF), lower than cost Merchant Discount Rate (MDR) to onboard high value merchants and less interest by banks in offering low cost domestic payment cards to their customers,” read the circular issued by SBP.

The central bank said that in order to address the above challenges and increase the POS card acceptance infrastructure in the country especially at retail level; in line with the objectives of National Payment System Strategy (NPSS), it has been decided to implement the following measures:

MDR for POS acquiring in Pakistan shall be within the range of 1.5 percent – 2.5pc for both existing and new merchants. The Merchant categories mentioned at Annexure – A shall be exempt from this requirement.
The Interchange Reimbursement Fee (IRF) for debit and prepaid cards issued in Pakistan used on domestic POS terminals shall be capped at 0.5pc.
Card issuers shall offer SBP approved Domestic Payment Scheme (DPS) Card as the default card at the time of issuance or renewal of debit cards. Accordingly card requesting customers shall be offered the following options in order of priority: That is either an exclusive DPS card or a DPS card co-badged with an International Payment Scheme (IPS) or an exclusive IPS card upon written request of the customer, informed SBP.
The SBP said that the instructions shall come into effect from April 01, 2020.



Amin Lalani is a subject matter specialist in Internet Retailer with several articles and research paper published so far. He has done M.Phil from IoBM in Marketing with emphasis on Internet Retailing. Besides academia he has various other certification like SAP, Google Analytic, Microsoft Small Business Solution Provider and more.

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