State Bank of Pakistan Governor Tariq Bajwa launches Pakistan's first blockchain-based cross border remittance service with Ant Financial, Telenor Microfinance Bank and Valyou. (Courtesy of Ant Financial)
The launch of Pakistan's first blockchain technology-backed cross-border remittance service, which is supported by Alibaba Group's financial arm Ant Financial, sheds light on how China and Pakistan have upgraded their cooperation from traditional industries such as infrastructure and energy to innovative technology under the Belt and Road Initiative (BRI), analysts said.
The service, launched by Pakistan-based Telenor Microfinance Bank in partnership with Valyou of Malaysia and backed by Ant Financial's blockchain technology on Tuesday, will significantly boost the speed and efficiency of remittances from Malaysia to Pakistan, realizing round-the-clock, real-time and low-cost money transfers, according to a statement Ant Financial sent to the Global Times on Wednesday.
It will also ensure that the transfers are secure and transparent, and that all information stored, shared, or uploaded through the blockchain remittance platform is encrypted with advanced protocols to protect users' privacy, the statement noted.
Tariq Bajwa, governor of the State Bank of Pakistan, said at a ceremony in Islamabad that the launch has "put Pakistan on the map of a few in the world that have launched international remittances using blockchain technology."
Bajwa was also quoted as saying in the statement that Pakistan expects more technology from China to contribute to his nation's financial digitalization.
Inward remittances contribute more than 6 percent of Pakistan's GDP, according to the statement.
The blockchain project is a vivid display of the deepening relationship between China and Pakistan, which ranges from cooperation in traditional infrastructure in the past to more new and innovative technologies, Zhou Rong, a senior research fellow at the Chongyang Institute for Financial Studies at the Renmin University of China, told the Global Times on Wednesday.
"The substance of the China-Pakistan Economic Corridor is becoming more technology-oriented. Pakistan is aiming to upgrade its technologies to catch up with global innovative business models and meet digital goals," Zhou added.
In addition to Alibaba, more Chinese high-technology companies could participate in and promote Pakistan's technological drive, analysts said.
For example, Pakistani officials have hinted that Pakistan could introduce 5G telecom services in 2019. China's telecom equipment maker Huawei, with competitive mobile technology and affordable prices, could be a key supplier of 5G equipment in the country.