MICROCAPITAL BRIEF: Pakistan Launches Digital Payment System Raast to Promote Financial Inclusion, Strengthen Rule of Law, Boost Government Services

The country of Pakistan recently began the rollout of Raast, an “instant digital payment system,” through which the government will route payments to individuals, such as salaries, pensions and welfare. Individuals and businesses will also be able to use Raast to make payments to one another via agents and mobile devices. Among its goals is to reduce the usage of cash, including by bringing more women into the “formal economy.” The platform is also meant to strengthen the rule of law, such as by increasing tax collections, reducing corruption and curbing illegal transactions that benefit extremist groups.

President Imran Khan of Pakistan stated, “Pakistan collects about the least amount of tax in the world.” Due to this, he said, “We cannot build infrastructure, we cannot work on human development, or educate children, or improve hospitals.”

The creators of Rasst, whose name can be translated into English as “direct way,” are the State Bank of Pakistan, the US-based Bill and Melinda Gates Foundation, the UK government, the UN and the World Bank.

By Sai Bommineni, Research Associate

Sources and Additional Resources

Reuters article
https://www.reuters.com/article/pakistan-economy/pakistan-government-announces-new-instant-digital-payment-system-idUSL4N2JM349

World Bank Group homepage
https://www.worldbank.org

Bill and Melinda Gates Foundation homepage
https://www.gatesfoundation.org/

UN homepage
https://www.un.org/

State Bank of Pakistan
https://www.sbp.org.pk/

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