Two technology companies of Pakistan have collaborated to form a local online payment gateway system for taking part in the expanding e-commerce market.
Avanza Group and Premier Systems made an announcement to do an investment of more than $5 million in the online gateway system, which would be connecting individuals with merchants and banks.
The firms would establish joint venture as Avanza Premier Payment Services (APPS).
The CEO of Avanza Group—Mahmood Kapurwala said that Pakistan’s e-commerce market size is approximated to be nearly around $1 billion, which should be $30-$40 billion in a nation with a population of two hundred and seven million. Avanza Group has partnered with Avaya, IBM, NCR and Microsoft. Kapurwala said that they are looking at this gap in the e-commerce market as an opportunity.
Arshad Raza—the CEO of Premier Systems said that Pakistan is at the point of revolution and they are proud of being a part of this revolutionary drive.
Premier System is an information communication technology (ICT) infrastructure, provider. It was established in the year 1993.
The APPS claims to be the first financial technology in the nation to acquire payment system provider (PSP) and payment system operator (PSO) licenses from the State Bank of Pakistan (SBP).
The regulator has given these licenses on the condition that the firm has raised a paid-up capital of two hundred million rupees.
APPS would serve as a shared payment system for working on any platform, which is like 1Link that connects ATM machines of various banks.
The CEO of APPS—Adnan Ali said that the initiative would be moving Pakistan towards digitalizing the major organizations, like schools, mutual funds, merchants, billing industries and other corporate bodies by providing a digital gateway.
He said that Pakistan’s economy is still relying on the cash-on-delivery (COD) model, with the e-commerce industry comprising of ninety per cent COD, indicating that the country has still to accept digitalisation.
The newly established firm has plans of encouraging the brick and mortar businesses with free online services, like the making of websites and digital marketing. The firm would only be taking a certain amount of profit that would come through the online businesses.
It has been noted that the significant reason why shopkeepers do not want to go for the online platforms is that the technology solution providers ask for a share in the total profits, offsetting the shopkeepers—who have got no experience in online business.