The FinTech Revolution: Banking 100M Unbanked

The most consequential thing to happen to Pakistani technology in the last five years was not a funding round or an exit. It was a payment rail.

Raast, the State Bank of Pakistan’s instant payment system, has gone from pilot to backbone, and it has quietly changed what is buildable in the country. If you are assessing Pakistan as a market, this is the infrastructure fact that matters most.

What the numbers look like now

That last figure is the one to sit with. When more than three quarters of digital payments originate on a phone, the phone is not a channel any more — it is the account. Product decisions that assume a branch, a card, or a desktop banking session are designing for a minority.

Why Raast changed the economics

Before an instant rail, a Pakistani fintech had to solve payments before it could solve anything else. Every product carried the cost of moving money — reconciliation, settlement delay, per-transaction fees that made small payments uneconomic, and integrations negotiated bank by bank.

Raast removes most of that. It is real-time, low-cost and interoperable across participating institutions, built and operated by the central bank rather than by a private network. Three consequences follow:

• Small transactions became viable. When the cost of moving money approaches zero, business models built on many small payments — micro-savings, pay-per-use, instalments, gig payouts — stop being impossible.
• Settlement is immediate. Products that depended on knowing money had actually arrived no longer wait days to find out.
• Interoperability is the default. A startup does not need commercial agreements with each bank to reach that bank’s customers.

This is the same pattern that UPI produced in India and Pix in Brazil: a public instant-payment rail resets the floor, and a wave of products becomes possible that were previously uneconomic rather than merely unbuilt.

The government-payments piece

The State Bank set out to route government payments through Raast, targeting the end of fiscal year 2025-26. Government disbursement is the most reliable on-ramp there is for financial inclusion: salaries, pensions and social transfers reach people who have no other reason to open an account.

It also matters for volume. Once state payments run on a rail, the rail is systemically important, which changes how seriously every institution treats integrating with it.

What "100 million unbanked" actually means

The phrase gets used loosely, so it is worth being careful. Pakistan has one of the world’s largest financially-excluded adult populations, with financial inclusion historically low — and severely lower among women than men.

But "unbanked" is not the same as "unreached". Many people counted as unbanked have a mobile phone, use a mobile wallet, receive remittances, and transact in cash for everything else. The gap is not access to a device or even to a wallet; it is access to the things a bank account is a gateway to — credit, savings products, insurance, and a financial identity that lets a small business be underwritten.

Where the remaining opportunity is

Credit and underwriting

A transaction history on an instant rail is the raw material of a credit score. The country now generates billions of digital transactions a quarter, which is exactly the data that was missing when the question was "how do you underwrite someone with no credit file?" Turning that into responsible lending — with the licensing that requires — is the largest open problem.

SME financial infrastructure

Small businesses adopted digital acceptance faster than they adopted digital books. Invoicing, reconciliation, payroll and tax filing for a business that now takes payment digitally is a real and mostly unserved need.

Cross-border

Remittances into Pakistan are enormous and the fees paid on them remain a meaningful tax on the people least able to pay it. The State Bank has been working on cross-border Raast connectivity, which is worth watching closely.

Savings and insurance

Almost everyone building on the rail went after payments and then credit. Micro-savings and micro-insurance remain thin, and both become distributable once the payment layer is free.

The honest constraints

• Licensing is the moat and the barrier. Lending, holding deposits and issuing money are regulated activities. The EMI and digital-bank licensing routes are real but slow and capital-intensive. Plan for it as a multi-year path, not a filing.
• Capital is thin. With Pakistani startups raising $36.6 million of equity across all of 2025, a licensed, capital-hungry fintech is a difficult thing to fund domestically.
• Trust is earned slowly. In a market where people have been defrauded, adoption is gated by trust more than by features. That is a distribution and brand problem as much as a product one.
• Unit economics on free rails. When payments cost nothing, you cannot monetise payments. Revenue has to come from credit, subscription or float — decide which before you build.

The read

Pakistan spent a decade being a market where fintech was hard because the plumbing was missing. That is no longer the constraint. The plumbing is public, instant, cheap and already carrying enormous volume.

What has not caught up is the capital and the licensing throughput. Which means the opportunity is real and the path to it is slow — a combination that favours founders who can operate near breakeven while they wait for a licence, and disadvantages anyone whose plan assumes a fast round.