ISLAMABAD, May 03, 2024: Karandaaz Pakistan, an impact investment platform dedicated to driving sustainable economic growth and strengthening financial and social protection systems for inclusion, announced its partnership with PostEx, a leader in e-commerce logistics with over 20,000 registered merchants and a customer base of over 20 million. This collaboration aims to transform Pakistan’s e-commerce landscape by digitalising cash-on-delivery (COD) payments.
This partnership falls under Karandaaz’s e-commerce value chain digitalisation initiative, which seeks to revolutionise the e-commerce industry with a particular focus on converting cash to digital payments, fostering a vibrant digital economy with new opportunities.
Cash on Delivery (COD) remains the dominant payment method in e-commerce, accounting for approximately 90% of all transactions. This heavy reliance on cash presents a significant growth hurdle for the e-commerce industry, leading to operational inefficiencies and costs associated with managing liquidity.
Despite the demand for digital payments at the doorstep, there is currently a lack of available payment options for customers. This partnership aims to address this issue by introducing various digital payment methods, such as QR codes, pay-by-link, and software point-of-sale systems, at the customer’s doorstep.
The project will be rolled out as a pilot in six major cities to assess customers’ value proposition and willingness to adopt these payment methods, and to evaluate the business case for digital payments for e-commerce service providers. The goal is to drive cashless transactions and gather valuable insights that demonstrate the benefits of going digital, thereby influencing e-commerce industry transformation.
Waqas ul Hasan, CEO Karandaaz, stated: “This collaboration is a significant milestone in our mission to establish a cashless economy in Pakistan. By advancing our broader agenda of creating a digital nation, we aim to contribute towards economic growth and development through innovative financial solutions. Our partnership with PostEx is crucial in realising our vision of a digitally empowered Pakistan, where seamless digital transactions become the norm, benefiting both consumers and businesses alike.”
Jawad Mirza, CEO PostEx Logistics, emphasised: “To tackle one of the biggest challenges in Pakistan, cash, we need to come up with innovative solutions to unlock the real potential of Pakistan. It is partnerships like these that have the potential to really push the markets in the right direction. Understanding the unique needs of the consumers and building innovative solutions is the only way to digitise COD, which contributes to over 95% of total transactions in ecommerce. Having over 30% of the market share, PostEx is well positioned to reach the masses, and with the help of Karandaaz, will be able to educate and enable millions for digital payments.”
Sharjeel Murtaza, Director of Digital Financial Services at Karandaaz, commented: “E-commerce has been a crucial driver of economic growth globally. The dominance of cash transactions has been a significant barrier which has to be removed with innovative solutions. Our pilot program with PostEx targets one of the biggest barriers, that is lack of trust, in local context. Simply put, it is the fear of not receiving what has been ordered despite the payment being processed at the time of ordering and no credible pathway to dispute resolution. With this partnership, we will enable digital payments at the door step which will not only help resolve the challenges related to cash in circulation instantly, but also induce the required trust in digital payments. By leveraging the learnings, we aim to build a robust digital payment ecosystem that enhances the consumer experience and fuels the growth of e-commerce businesses in Pakistan.”
Karandaaz’s collaboration with PostEx marks a significant effort towards realising a digital ecosystem. This transformative initiative aims to revolutionise the e-commerce payment landscape, promote the digital economy, and foster sustainable economic growth in Pakistan.