Mobi Direct, a company pioneering Electronic Commerce Payment Gateway services in Pakistan, has withdrawn its license application from the State Bank of Pakistan (SBP). This decision comes as a surprise to analysts considering the booming e-commerce market and the potential for growth in the digital payments sector.
Mobi Direct received initial approval from SBP in 2016 but failed to progress to the pilot launch stage. Experts attribute the withdrawal to factors like intense competition, rapidly evolving technology, and concerns about profitability in the e-commerce payment space.
The high minimum capital requirement of PKR 200 million is also cited as a hurdle for new Payment Service Providers/Operators (PSP/PSO) seeking to establish themselves in Pakistan.
This news follows a recent trend of Electronic Money Institutions (EMIs) in Pakistan either withdrawing licenses or delaying their launch plans. The SBP currently oversees five operational PSP/PSOs, with three in pilot stages and four others holding licenses or in-principle approvals. However, seven operators haven’t shown any progress in nearly a decade, raising questions about the regulatory framework’s effectiveness.
Mobi Direct’s withdrawal highlights the challenges faced by new entrants in Pakistan’s digital payments landscape. It remains to be seen if this will deter other potential players or prompt reforms to create a more conducive environment for innovation in the e-commerce payment sector.
