SBP is organizing an Ideathon to seek innovative ideas or solutions from the public for the following themes:

Improved gender-parity can enhance socio-economic development outcomes for not just the existing but future generations. Better opportunities for women and youth to earn and control income could immensely contribute to broader economic progress in the developing economies; for instance through higher levels of school enrollment for girls, improved productivity of new and female-owned companies, and risen potential of economic growth for the country.

In this regard, women’s equal access to financial services becomes a priority for a country like Pakistan whose population of 207.8 million includes 49% women who largely lag behind men in terms of financial inclusion and contribution to economic activity. Despite the fact that women have made some strides in terms of financial inclusion, a gaping gender divide exists in the country, which is one of the widest amongst its South Asian peers. As per the Findex 2017, 21% of adults in Pakistan have a formal financial account in Pakistan increasing from 13% in 2015. However, as per gender-disaggregated analysis almost 93% of adult women in Pakistan do not have a formal financial account, which can provide an avenue for ownership and safe storage of money, and serve as a conduit for other formal financial services, critical for improved socio economic outcomes for them and their families.

It is estimated that the market potential of Digital Finance Services (DFS) in Pakistan will cross US$ 36 Billion by 2025, providing a 7% boost to the GDP, creating 4 million new jobs and resulting in US$ 263 Billion new deposits. Although Pakistan does possess a nascent DFS ecosystem, to tap its true potential, innovative solutions from fin-techs for the women and youth market segments offers huge opportunity to help Pakistan leapfrog into the next generation of DFs enabled economic growth. The ultimate goal is to use DFS to make markets so inclusive that even small entrepreneurs in Pakistan, such as a young woman making crafts in rural Sindh, can sell it online across Pakistan and generate revenues digitally.

In Pakistan, financial numeracy and awareness of basic financial concepts and terms is relatively high but a better understanding of relevant products and services remains low. For instance, according to Access to Finance reported in 2015, reported awareness and understanding of basic financial terms like ‘bank’ and ‘loan’ is 85 and 65 percent respectively. However, awareness of other strategically important terms like mobile money remains below par. According to the A2F 2015 survey, only 37 percent of adults understand the term ‘mobile money’, 30 percent understand ‘ATM’, and 16 percent understand ‘debit card.’ Similarly, according to the Financial Inclusion Insight (FII) 2016 survey, although basic numeracy, such as the ability to do addition, subtraction and division are high, less than 18 percent of adults understand more complicated financial concepts like interest or inflation. Further, around 23 percent of adults reported not using a mobile money product because either they didn’t understand how to use the account, or didn’t understand the use case / benefits of a mobile account.

Awareness of financial products and services is a point of concern for the uptake of digital services and mobile money products and digital solutions to improve financial literacy and awareness for masses are critical for catalyzing inclusive economic growth in the country.

Informal savings such as “committee system” in Pakistan are a prevalent saving mechanism. In such informal saving mechanism, people rely on social networks to pool in funds and facilitate credit / financing needs for individuals and small businesses. Though these informal saving mechanisms have advantages, it is also a fact that informality may leads to problems such as frauds, theft of committee money, and isolation from formal financial services. To address these issues and enhance efficiency in the informal saving mechanisms, it is imperative that these mechanisms may be digitized in Pakistan by building a digital platform for collection and distribution of funds.