Regulatory AlertsPakistan: fintech & payments regulation
Partially regulatedSBP regulates payments via Payment Systems Bureau; no standalone fintech licence yet
- Lead regulator
- State Bank of Pakistan (SBP)
- Also involved
- Financial Monitoring Unit (FMU) for AML/CFT · SECP for corporate registration
- Core law
- Payment Systems and Electronic Money Institutions Act, 2024
- Entry capital
- —
- Approval timeline
- 6-12 months for PSP/e-money approval; varies
- Customer assets
- Segregated trust account required; no commingling
- Data protection
- PECA 2016 / Personal Data Protection Bill (pending); SECP guidelines
- Sandbox
- Yes - SBP Regulatory Sandbox
The State Bank of Pakistan (SBP) is the primary regulator for payment systems and electronic money. The regulatory landscape is transitioning from the 'Regulatory Framework for Payment Systems' to the new Payment Systems and Electronic Money Institutions Act, 2024. Currently, fintechs operate under strict guidelines for payment service providers (PSPs) and exchange companies, with no standalone 'fintech licence' category yet fully operationalized for all activities. The SBP is actively facilitating digital service providers and remittance flows while tightening AML/CFT reporting via the Financial Monitoring Unit (FMU).
Which licence do you need?
| Your activity | Requirement | Capital | Timeline | Authority |
|---|---|---|---|---|
| Payment processing / gateway | LicencePayment Service Provider (PSP) Licence[1] Requires SBP approval; strict IT and capital norms apply | — | — | State Bank of Pakistan (SBP) |
| E-money & wallet issuance | LicenceElectronic Money Institution (EMI) Licence[1] Governed by new Act 2024; currently under transition | — | — | State Bank of Pakistan (SBP) |
| Domestic money transfer | LicencePayment Service Provider (PSP) Licence[1] Domestic transfers require PSP status or bank partnership | — | — | State Bank of Pakistan (SBP) |
| Cross-border remittance | LicenceExchange Company Licence[2] Exchange companies authorized for inward remittances; digital disbursement via Raast allowed | — | — | State Bank of Pakistan (SBP) |
| Agent network | RegistrationAgent Network Registration[1] Agents must be registered with licensed PSPs or banks; strict KYC required | — | — | State Bank of Pakistan (SBP) |
| Open banking / account information | Uncertainverify with regulator No formal open banking framework yet; SBP promotes Raast interoperability | — | — | — |
| Foreign-exchange services | LicenceExchange Company Licence FX services restricted to authorized dealers and exchange companies | — | — | State Bank of Pakistan (SBP) |
New — what changed recently
- 2026-06-10Instructions on Islamic Banking Windows Operations — SBP allows banks to establish interim Islamic Banking Windows without prior approval, waiving licensing fees for branch conversions.
- 2026-05-22Distribution of Services by Intermediaries/Aggregators — SBP authorized Pakistani companies to act as intermediaries for foreign digital service providers to process remittances, subject to strict audit requirements.
- 2026-04-10Amendment in Instructions Related to Inward Home Remittances — Exchange companies now authorized to execute forward sale transactions with Authorized Dealers for remittances received within five working days.
- 2026-01-15Amendment in Instructions Related to Business of Exchange Companies — SBP authorized digital home remittance disbursements via Raast, requiring prior departmental approval and Raast onboarding for exchange companies.
Market-entry checklist
- 1Register as Exchange Company or PSPApply to SBP for Exchange Company Licence or PSP Licence depending on activity scope.
- 2Establish Segregated Trust AccountOpen a dedicated trust account with an Authorized Dealer for customer funds, as per SBP guidelines.
- 3Implement Raast IntegrationOnboard with SBP's Raast instant payment system for digital disbursements and interoperability.
- 4File CTRs with FMUEnsure the bank holding the customer account files Currency Transaction Reports with the Financial Monitoring Unit.
- 5Submit Business Plan to SBPPrepare and submit a comprehensive business plan approved by the Board, detailing capital and IT infrastructure.