After the State Bank of Pakistan (SBP) cancelled the payment of $34 million to foreign service providers, mobile users in Pakistan won’t be able to download Google Play Store services from December 1st, 2022.
Payments of $34 million annually through mobile firms to overseas service providers, such as Google, Amazon, and Meta, were stuck after the SBP banned the Direct Carrier Billing (DCB) method.
According to Geo, customers from Pakistan will now be compelled to download Google and other foreign apps in order to make purchases using credit cards or debit cards exclusively. However, because the credit card option is only available to a certain number of consumers, the majority of mobile users might not be able to download apps from the Google Play Store.
On Friday, the Pakistan Telecommunication Authority (PTA), the Ministry of Information Technology & Telecommunication, and four cellular mobile operators (CMOs) unanimously wrote a joint letter to the State Bank of Pakistan asking it to reconsider its decision to revoke the DCB mechanism for payment of the dollar fee in light of the country’s current liquidity crisis.
The News has confirmation from top government sources that Google services like downloading apps won’t be available. They informed the appropriate authorities that a $34 million payment was past due and that, if it was not paid, their services for Google App Store downloads would cease to be offered.
In a joint letter to the government, the four mobile operators said that in addition to other major contributions in the form of tax, tariffs, and other levies, the telecom sector is one of the largest donors to foreign direct investment.
It is impossible to disregard the role that the telecom industry has played in advancing the goals of Digital Pakistan. All stakeholders must be involved in and facilitate Pakistan’s digital transformation if it is to have a positive impact on all social and economic sectors.
The IT designation of telecom providers was withdrawn months ago by the State Bank of Pakistan (SBP). Furthermore, it was suggested that instances be sent to SBP individually for approval. As a result, the mobile operators complained that they were experiencing lengthy delays in obtaining approvals, which was causing a disruption in crucial services. These services include billing management, fraud management software, Office 365, robotics automation software, payments for software developers, and payments related to digital advertising on large IT platforms.
The hosting on cloud platforms, licensing needed for services/platforms, security measures, and in many instances technical skills to upskill the local workforce to reach international standards are all areas where Pakistan’s digital economy heavily depends on foreign service providers.
Due to non-payment, all of the big companies, including Google, Amazon, and Meta, are suffering and are most likely to stop providing their services. Telecom and internet customers’ inability to access digital platforms like those used for digital banking, e-commerce, e-education, and e-health that rely on cloud infrastructure and require licencing for both apps and web-based platforms will be a direct result of this. Given the lack of distribution support and interest from the industry players like Google, Amazon, and Apple representing Facebook, distribution and monetization of digital platforms will become very difficult.
As a result, companies, services, and goods beyond the digital sphere will be impacted. Digital marketing is now the most effective channel for all businesses, products, and services.
“Any potential outage of such digital services due to non-payments would create a lot of negativity in the world about Pakistan in this age of social media and should be avoided at any cost,” stated the letter.
The letter concluded: “It is pertinent to mention here that we all understand the prevailing challenge of worsening economic conditions of the country and thus are open to working in an amicable way with the Regulator (SBP); as we are already working with them in case of the telecom sector imports related transactions to navigate through these testing times.”
