KARACHI: Last year, Keenu, a supplier of digital payment services, announced the completion of its management buyout.
Data Darbar estimates that Keenu, one of the bigger competitors, holds roughly 25% of the point-of-sale (POS) market, after Habib Bank Ltd. These estimates are based on the most recent data from annual reports. Keenu worked with Bank Al Habib because it was the first non-bank enterprise in the market to implement point-of-sale (POS) technology.
“We have only touched five percent to ten percent of the POS industry,” remarks Saad Niazi, acting CEO of Keenu and former chief operating officer of the company for more than ten years.
Keenu is based its future plans on the promise made by the State Bank of Pakistan (SBP) when it introduced its Raast Person-to-Merchant service in December of last year. With the help of the P2M service, retailers should be able to take payments via Request to Pay, Raast Alias, IBAN, and Quick Response (QR) Codes. Payments via Raast P2M must be accepted by retailers and online retailers by the beginning of April of this year.
Mr. Niazi says, “There is a lot of opportunity going downstream with the introduction of Raast P2M.” “We believe that there’s much more possibility with hundreds of thousands of second-tier merchants, but up until now we were only utilizing tier I merchants.”
He explains the market potential by pointing out that just 8–10% of the POS in Pakistan and around the world are tier I merchants. The remaining tiers are lower tiers.
However, why would retailers decide to go digital and join the tax-paying formal economy?
The CEO of Keenu claims that “not being digitized is a perception related issue.” Retailers believe that by avoiding the unofficial market, they will save taxes. He goes on to say that they must be made aware of the benefits of participating in the formal economy, the most important of which is having access to bank credit. If a small business cannot obtain financing from official institutions, it will remain tiny.
The Federal Board of tax, the central bank, and other tax authorities are under additional pressure to formalize small retail companies due to the situation of the economy and pressure from the International Monetary Fund. Keenu thinks it can boost market penetration with legal pressure and the availability of advantageous alternatives.
SOURCE: DAWN NEWS
