The State Bank of Pakistan’s (SBP) call for innovation and inclusivity in banking is long overdue for a sector that has remained firmly entrenched in outdated practices. Excessive paperwork, minimal technological integration, and a general resistance to change have made traditional banking cumbersome for users and unattractive to investors. Meanwhile, fintech startups, unburdened by this stagnation, are flourishing by addressing the sector’s gaps with efficient, user-friendly solutions.

For Pakistan to realise its ambitious vision of becoming a digital services export hub—a goal articulated by the prime minister and the Punjab chief minister—banking modernisation is non-negotiable. A robust, tech-driven banking system is essential for supporting digital payments, fostering entrepreneurship, and attracting global tech players. Without it, the vision will remain just that—a vision, disconnected from ground realities.

However, innovation is not merely about digitisation for the sake of convenience. It must also address inclusivity, bringing financial services to underserved populations, particularly in rural and remote areas. Digital banking tools, when effectively deployed, have the potential to democratise financial access and contribute to broader economic stability. This is the moment for policymakers to devise a cohesive strategy that combines regulatory flexibility with an encouragement of innovation. Banks must be nudged—if not pushed—into adopting cutting-edge technologies such as artificial intelligence, blockchain, and data analytics. Simultaneously, consumer trust in digital services must be cultivated through robust cybersecurity measures and transparent governance.

Failing to act now risks leaving Pakistan isolated from the global financial ecosystem. The world is evolving rapidly, and the country cannot afford to lag behind. The banking sector must not just catch up with the present but also anticipate the future, positioning itself as a partner in progress rather than a relic of the past.