Page 67 - CMA Journal (July-August 2025)

Focus Section

Notable funding rounds included Abhi (USD 15 million), Trading remains dominated by peer-to-peer exchanges
PostEx (USD 7.3 million), and Neem (USD 4 million), such as Binance, KuCoin, and Kraken, as banks are
reflecting growing investor interest in BNPL solutions restricted from processing crypto transactions. The
and embedded finance. establishment of the Pakistan Virtual Assets Regulatory
Authority (PVARA) and the ongoing efforts of the
This surge in funding was accompanied by a steady rise
Pakistan Crypto Council signal progress toward a clearer
in fintech startups, increasing from 35 in 2019 to a record
regulatory framework, which could legitimize and further
62 in 2021, as shown in Figures 3 and 4.
expand the sector.
Figure 3: Total Number of Companies in the Fintech Sector in Pakistan Looking ahead, fintech is becoming an integral part of
62 Pakistan’s broader digital transformation strategy. The
48
43 government has launched a Central Bank Digital
35
26 Currency (CBDC) pilot and allocated 2,000 MW of surplus
electricity for bitcoin mining and AI data centers. With
4
support from China under CPEC in areas such as 5G and
2019 2020 2021 2022 2023 2024 artificial intelligence, fintech is set to remain central to
Pakistan’s digital economy. However, challenges
Source:https://tracxn.com/d/explore/fintech-startups-in-pakistan/__OOMGzIeyZYPyvEWpfn5a944aEy78_lJ8i3yxi2iu-K8#top-companies
including unstable funding flows, weak regulation,
Figure 4: Total Funding YoY in the Fintech Sector in Pakistan
(in USD Million) cybersecurity risks, and uneven digital access must be
addressed for the sector to sustain its momentum.
2 2019 3.38
2 2020 1 10.4
2 2021 120 Fintech Adoption in MENA
2 2022 152
2 2023 1 12.1 MENA is an abbreviation that stands for the Middle East
2 2024 26.3 and North Africa. Countries that make up the MENA
2 2025 52 region are Bahrain, Oman, Libya, Qatar, Algeria, Saudi
Arabia, the United Arab Emirates, Kuwait, Iraq, Syria,
Source: https://tracxn.com/d/explore/fintech-startups-in-pakistan/__OOMGzIeyZYPyvEWpfn5a944aEy78_lJ8i3yxi2iu-K8#funding-trends
Egypt, Morocco, the Islamic Republic of Iran, Israel,
Startup formation slowed sharply in 2024, with only four Tunisia, and Yemen. Sudan and Turkey are included
new companies emerging due to tighter funding and sometimes.
tougher market conditions, signaling sectoral
The MENA region has emerged as the world’s
consolidation. At the same time, Pakistan’s digital
fastest-growing fintech market, with revenues projected
payments ecosystem has surged, with the wallet market
to increase by 35% annually until 2028. As shown in figure
reaching USD 343 billion (Rs. 96 trillion), powered by
6, the market is valued at USD 1.66 billion in 2025 and is
Raast, as of 2024 it has processed over 892 million
expected to reach USD 2.63 billion by 2030 (CAGR 9.71%).
transactions worth more than Rs. 20 trillion since its
More than 1,000 fintechs, four unicorns, and USD 1.9
launch. Financial inclusion has risen dramatically, with
billion raised in 2023–24 highlight strong momentum.
account ownership growing from 16% in 2018 to 64% in
However, penetration remains low compared with the US
2024, supported by 59 million branchless wallets, 19
and UK, leaving substantial room for expansion.
million mobile banking users, and 12 million internet
banking users—reflecting a nationwide shift toward Growth is concentrated in the UAE, Saudi Arabia,
digital finance. Bahrain, and Egypt, which account for 99% of funding.
Payments dominate the sector, attracting 42% of
Meanwhile, cryptocurrency adoption has accelerated
investment and expanding 152% annually, supported by
despite regulatory uncertainty. As shown in figure 5,
95% consumer openness to digital wallets, wearables,
the number of users increased from 1.65 million in
and biometrics. Although overall funding declined 47%
2019 to 27.1 million in 2025, although growth has
in 2023, stable early-stage valuations point to sustained
recently stabilized.
investor confidence.
Figure 5: Cryptocurrency Adoption Rate in Pakistan Governments are driving growth through proactive
(Users in Million)
regulation: the UAE’s FIT program, Saudi Arabia’s open
26.977 27.1
30 banking framework, Bahrain’s sandbox model, and
1 18.25 Egypt’s financial inclusion initiatives. The UAE leads with a
20
13.46
9.36 33% market share, Saudi Arabia benefits from 94% NFC
10 1.65 3.21 adoption, and Bahrain is the fastest-growing market with
0 a 15% CAGR. Morocco, meanwhile, is widening wallet
2019 202 2 0 2 0 2 1 2022 2 2023 2024 2025
adoption through the spread of payment accounts.
Source: https://www.datawallet.com/crypto/best-crypto-exchanges-pakistan
ICMA’s Chartered Management Accountant, Jul-Aug 2025 65