Pakistan’s fintech sector is undergoing a transformative phase, with expectations to cross the $7 billion mark by the fiscal year 2026, according to Muhammad Ghazali Aqeeq, a prominent Middle East-based investor and managing director of a leading management consulting firm. Ghazali highlights that this projection is driven by rapid technological advancements and an increasing demand for digital financial solutions across the country.
He stated that the fintech market in Pakistan is expected to grow at a robust compound annual growth rate (CAGR), with estimates ranging between $7 billion and $10 billion by FY26. This growth trajectory indicates a rising demand for modern financial services, which is also expected to contribute significantly to financial inclusion and overall economic resilience.
However, Ghazali pointed out that despite the growth potential, fintech companies in Pakistan face several challenges, primarily stemming from the regulatory frameworks administered by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP).
Pakistan’s large and youthful population, exceeding 240 million, presents a substantial opportunity for fintech expansion. A significant portion of this population is under the age of 30, representing a demographic that is increasingly tech-savvy and more inclined to adopt digital payment platforms and financial technologies. Ghazali emphasized that this digital affinity is a key driver for fintech adoption.
He further explained that nearly 100 million adults in Pakistan remain unbanked or underbanked. This gap in financial services represents a critical area where fintech solutions can bridge the divide by offering more accessible and cost-effective financial products directly to consumers.
Another factor supporting this optimistic forecast is the increasing penetration of smartphones and internet connectivity, especially in rural regions. This improvement in digital infrastructure enables more individuals to access services such as mobile wallets, digital banking, and fintech applications, making financial services more inclusive and wide-reaching.
Investment in Pakistan’s fintech sector is also expected to rise, with interest from both local and international investors. Ghazali noted that such investments are vital for scaling up operations, introducing new technologies, and diversifying service offerings. Moreover, these developments are likely to create thousands of employment opportunities in the domestic market.
He identified several promising verticals within the fintech landscape, including digital payments, lending platforms, InsurTech, remittance services, and wealth management tools. These solutions address various financial needs of both consumers and businesses.
While acknowledging the sector’s potential, Ghazali also expressed concern over regulatory challenges that could hinder growth. He proposed reforms such as a streamlined licensing process through a single-window digital system and clear timelines for approvals. Such measures could facilitate quicker market entry for new fintech products and companies.
He also recommended that the SBP and SECP consider simplifying the complex compliance requirements currently in place. A consolidated joint regulation framework could ease the burden on fintech firms and make compliance more straightforward.
Ghazali highlighted that uncertainty around certain areas—like blockchain technology and peer-to-peer lending—continues to discourage investment. He urged regulatory bodies to offer more clarity to boost confidence among stakeholders.
He further suggested that third-party engagements could help address growing concerns about data privacy and cybersecurity. Engaging specialized vendors to set a minimum standard for data protection compliance could help ensure uniform implementation across the fintech sector, minimizing the need for each company to build independent compliance infrastructures.
Additionally, Ghazali advocated for enhanced collaboration between regulators and the fintech industry. Establishing regular communication channels, hosting stakeholder forums, and creating a single API access point could reduce bureaucratic delays and foster a more innovation-friendly environment.
In conclusion, he emphasized that the continued growth and innovation in Pakistan’s fintech sector depend heavily on the country’s ability to modernize its regulatory environment. By improving transparency, streamlining processes, and promoting public-private partnerships, the fintech ecosystem in Pakistan can unlock its full potential and contribute significantly to economic progress.
