Telecom operators are voicing their concerns regarding the Ministry of IT’s plan to offer smartphones on an installment basis, suggesting that this policy could adversely affect Pakistan’s digital environment.
Sources within the telecom industry indicate that two out of four mobile operators have raised issues with a significant aspect of the policy that requires blocking all SIMs linked to individuals who default on payments.
They contend that this approach would not only strip citizens of their digital rights but also hinder digital inclusion across the nation. The dissenting telecom companies argue that in many other countries, it is the governments, rather than telecom operators, that take on the financial risks associated with defaults, and they are reluctant to shoulder this burden without a viable strategy to mitigate potential losses.
At present, the policy is still being deliberated, as the Ministry of IT has asked telecom operators to agree. The Ministry has completed the framework and shared it with the telecom companies, but the main points of contention continue to be the proposed enforcement of SIM-blocking for defaulters and the financial responsibilities that telecom operators might face.
While some operators are in favor of the initiative, others are firmly against a centralized system that would result in the suspension of all SIMs associated with a defaulter’s CNIC. Furthermore, telecom operators have expressed that they should not be held accountable for the risks of defaults or the costs of subsidies.
This initiative was initially drafted in November 2023 and submitted for cabinet approval in early 2024. However, the cabinet returned it to the IT Ministry, instructing it to have the policy reviewed by the Law Division. After the general elections, the revised proposal was presented to the new IT Minister, Shaza Fatima, who then created an updated draft incorporating feedback from banks, fintech companies, and telecom operators.
Efforts to improve the policy have been stymied by ongoing disagreements among Chief Marketing Officers (CMOs). Without a unified stance from the operators, the policy cannot move forward to the federal cabinet for final approval.
Officials from the IT Ministry have pointed out that the primary issue lies not in the provision of smartphones through installments, but rather in establishing a robust enforcement mechanism for those who default. The IT Ministry and the Pakistan Telecommunication Authority (PTA) can only implement the plan once the federal government issues a definitive policy directive.
Telecom operators who are against the proposal have put forth alternative ideas, such as permitting higher interest rates or requiring upfront payments to reduce risks. Nevertheless, the government remains skeptical, contending that installment-based smartphone options with elevated interest rates are already present in the market.
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