The State Bank of Pakistan (SBP) on Thursday issued instructions that will enable Person-to-Person (P2P) fund transfers in the country through Raast, Pakistan’s Instant Payment System developed by the central bank.
Launched by Prime Minister Imran Khan on January 11, the initiative is part of his “Digital Pakistan Vision” aimed at including poor segments of society in the formal economy. Raast is being developed in collaboration with Karandaaz, Pakistan and introduced in phases.
With the launch of Raast, Pakistan joined a select club of countries that have either launched or are in the process of launching Instant Payment Systems.
What is Raast?
According to State Bank’s official website, Raast is Pakistan’s first instant payment system that will enable end-to-end digital payments among individuals, businesses and government entities instantaneously.
Translated as the ‘right-way’ in Urdu, Raast offers an instant, reliable and zero-cost digital payment system to the people of Pakistan.
The state-of-the-art Pakistan’s Faster Payment System will be used to settle small-value retail payments in real time while at the same time provide a cheap and universal access to all players in the financial industry including commercial banks, microfinance banks, government entities and fintechs (EMIs & PSPs).
The P2P service
In a statement, SBP believes that the launch of Raast P2P service will not only provide a convenient and hassle-free digital fund transfer service to customers but will also provide an efficient and enabling payments infrastructure that would pave the way for digitization of the economy and promotion of digital financial services in the country.
Under Raast Person-to-Person (P2P) fund transfers and settlement services, bank customers would be able to send and receive funds in their accounts using their bank’s mobile application, internet banking or over-the-counter services.
To facilitate banks in this regard, SBP will also offer free-of-cost Raast services to banks. Further, to facilitate their customers, banks shall not assign minimum transaction size.
In general, banks shall allow maximum transaction limits of PKR 200,000 per transaction or higher depending on the bank’s assessment of the risk profile of the customer.
For particular account types where the SBP has prescribed limits from time to time, the maximum transaction limit could be lower than PKR 200,000 per transaction. SBP has advised banks to provide a smooth, convenient and hassle-free user experience to their customers using Raast.
How to register?
For customers’ facilitation, they can set their registered mobile phone number as their Raast ID and link it to their preferred International Bank Account Number (IBAN) using the bank’s mobile application, internet banking, or visiting their bank branch.
Once a customer has set her/his mobile phone number as the Raast ID, others can send money to her/him using her/his mobile phone number without the need to know the account number or any other details.
Bank customers can still use Raast service for sending or receiving funds using their IBANs even if they do not have a Raast ID or prefer to use their IBAN.
SBP has directed all banks to make Raast Person-to-Person fund transfer service available on at least three customer channels including mobile application, internet banking and branch counters.