ISLAMABAD – Pakistan is transforming digital payments landscape with the launch of its first locally developed credit card under the PayPak payment network, a key initiative that could cut the country’s dependence on global payment giants while opening credit card market to more banks.
PayPak credit card, expected to be introduced later this year, is being developed by 1LINK in collaboration with member banks and the State Bank of Pakistan. According to 1LINK CEO, the card will be accepted nationwide, giving consumers access to Pakistan’s first domestically managed credit card network.
The move shows shift for Pakistan’s financial sector, where credit cards have long been dominated by international payment companies such as Visa and Mastercard. While local banks issue these cards and provide the underlying credit facilities, every transaction is processed through foreign payment networks. The arrival of PayPak Credit is expected to localize that process by enabling domestic credit card transactions to be routed through Pakistan’s own payment infrastructure.
Under new system is pay-as-you-earn model, which lowers the cost of entering credit card business. Instead of investing heavily in expensive technology, fraud monitoring systems, billing platforms, and risk management infrastructure, banks will be able to use 1LINK’s centralized card management services, allowing them to launch credit card products with significantly lower upfront costs.
The initiative is expected to benefit smaller and medium-sized banks that have traditionally been unable to compete in the credit card segment because of high operational expenses. Industry observers believe the model could democratize credit card issuance by enabling more financial institutions to offer credit facilities to their customers.
These credit card will start next phase of PayPak’s expansion and aligns with Pakistan’s broader strategy to accelerate digital payments and reduce reliance on cash. By processing transactions domestically, the system is expected to lower transaction costs for banks and merchants while strengthening the country’s financial sovereignty.
Pakistan’s credit card market is currently served primarily by major commercial banks, all of which issue cards through international payment networks. The emergence of PayPak Credit could reshape this landscape by providing banks with a locally managed alternative that reduces dependence on foreign payment companies.
Beyond intensifying competition in the payments industry, the initiative has potential to lower operational costs, expand access to credit card services, encourage greater financial inclusion, and reinforce the country’s transition toward a digitally driven, cashless economy.
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