Is PayPal ‘Finally’ Coming to Pakistan?

Islamabad: The State Bank of Pakistan (SBP) has expressed its willingness to facilitate PayPal’s potential entry into Pakistan, aligning with ongoing efforts led by the Ministry of Information Technology and Telecommunication (MoIT&T). This development represents a significant step toward addressing long-standing demands from freelancers, e-commerce businesses, and digital entrepreneurs seeking seamless international payment solutions.

Senate Finance Minister Muhammad Aurangzeb disclosed during a National Assembly session that officials from the MoIT&T are currently engaged in negotiations with PayPal regarding Pakistan’s market entrance. A meeting was conducted by the Secretary of MoIT&T on December 13, 2024, which functions as a significant milestone in the negotiations.

In Pakistan, payment services are presently available through viable alternatives such as Skrill and Payoneer, and the Finance Minister has confirmed their accessibility to digital payment users. PayPal PTE is an indirect subsidiary of PayPal Inc. that is headquartered in Singapore. It collaborates with four Pakistani banks to address the local remittance requirements of Pakistanis.

Aurangzeb asserted that foreign payment gateways, such as PayPal, are permitted to operate in Pakistan provided that they comply with the country’s Electronic Money Institution (EMI) and Foreign Exchange regulations.

The MoIT&T  previously acknowledged the obstacles associated with the introduction of PayPal to Pakistan, stating that the company retains the final say, despite ongoing discussions. She emphasised that the government can only facilitate the process, not mandate PayPal’s entry, and that private firms operate based on their business interests.

Dr. Umar Saif, the caretaker Minister for IT and Telecom, announced in January 2024 that PayPal would enter the Pakistani market through a strategic partnership with an international payment gateway..

He had asserted that the agreement would enable Pakistani freelancers to receive payments through PayPal. The entity would not be accessing Pakistan directly or through any third-party arrangement, as it was subsequently clarified that negotiations with PayPal were unsuccessful.

Pakistan has been in discussions with PayPal for several years in an effort to integrate the payment giant into the country’s expanding digital economy. However, PayPal has yet to establish direct operations in Pakistan, despite the numerous discussions.