On December 1, the State Bank of Pakistan (SBP) implemented a change in the payment method, potentially causing disruptions for Android users in Pakistan who download apps from Google’s Play Store.
The motive behind this decision was to restrict the outflow of US dollars from the country and safeguard its reserves. As a result, the SBP discontinued external transfers of US dollars using the direct carrier billing (DCB) system.
This alteration in payment mechanism has led the central bank to stop making approximately $34 million in annual payments through mobile companies to foreign service providers such as Google, Amazon, and Meta.
Under the previous method, subscribers’ telecom operators settled the expenses with international service providers on behalf of those who made purchases or subscribed to apps on the Google Play Store by choosing the direct carrier billing option.
However, with the new ruling in effect, telecom providers can no longer bill local subscribers in rupees for their purchases on Google’s app store and later pay Google in US dollars.
Nonetheless, subscribers still have the option to link their credit and debit cards to pay for their preferred apps.
In response to the proposed legislation, Information Technology and Telecommunication Minister Syed Aminul Haque expressed concerns to Federal Finance Minister Ishaq Dar and requested his intervention.
The minister highlighted that besides affecting telecom service providers, the ruling could significantly impact services used by millions of people. The IT ministry, Pakistan Telecommunication Authority (PTA), and cellular mobile operators (CMOs) have also urged the central bank to reconsider its decision and reinstate the previous payment mechanism.