State Bank of Pakistan has issued regulations for pre-paid system to introduce replaced digital sources in order to take advantage of card technology. According to a notification by State bank, prepaid card is a source of payoff is based on the model of “first pay, later spend” which is different from debit and credit cards. Prepaid cards are considered ideal for those who are deprived of banking facilities.

Prepaid is used as a replacement for Transaction Banking because its characteristics are similar to the characteristics of Transaction Banking Accounts due to which these prepaid cards are important for people deprived of banking services. Prepaid customers can now use these cards to transfer funds, deposition of examination fee, taking money from ATMs and online purchasing without debit/ credit cards. It will reduce the danger associated with payment card.

According to SBP, these regulations are prepared according to the recommendations of Financial Action Task Force (FATF) and their purpose is to reduce the dangers of monetary benefit to money laundering and terrorism related to prepaid cards.

Now monetary institutes are allowed to release prepaid cards in order to progress the use of this card in domestic market. According to State Bank, these regulations will allow banks to form the market of prepaid market in the country.

Prepaid Cards in Pakistan for Payment