ISLAMABAD: Pakistan’s IT start-ups and freelancers said this week they continue to face crippling payment barriers and shrinking funding despite record export growth, warning that missing global payment platforms and complex banking processes are holding back one of the country’s fastest-growing sectors.
Pakistan’s IT exports hit a historic $3.8 billion in FY 2024–25, up from $3.2 billion the previous year, marking an 18 percent year-on-year increase, according to the Pakistan Software Export Board (PSEB). The government hopes to raise the figure to $15 billion by 2030, but industry leaders say the absence of trusted payment gateways like PayPal and Stripe is slowing progress.
Tufail Ahmad Khan, President of the Global Freelancers Union, said Pakistan now ranks fourth globally in freelance talent but workers face significant hurdles in repatriating their earnings.
“Earning money is not the real problem. The problem is bringing it back to Pakistan,” he told Arab News. “Without PayPal or any major international payment system, freelancers have to pay hefty cuts and margins. Their income is being eaten up simply due to the lack of proper channels.”
Start-up founders report similar challenges.
Hasan Khan, the Chief Executive Officer of an IT start-up, said the issue affects both freelancers and young companies.
“We cannot receive payments from international clients through proper channels,” he told Arab News. “Sometimes our money gets stuck, sometimes the taxes are too heavy.”
“PayPal, Stripe, Checkout— these systems transformed other markets,” he added. “If they come to Pakistan, the IT business will boom.”
Hasan said even opening a basic bank account for a registered company could take weeks due to bureaucratic delays, limiting firms’ ability to scale quickly.
Sajjad Syed, Chairman of the Pakistan Software Houses Association (P@SHA), said payment difficulties were only one part of a wider challenge.
“Access to funding is limited,” he told Arab News on Tuesday. “Startups face regulatory uncertainty, weak IP protection, power outages, unreliable Internet and difficulty scaling due to limited understanding of global markets.”
Syed added that gender gaps, currency volatility, global competition and the absence of trusted payment gateways all made it harder for Pakistani start-ups to grow. “The potential is enormous, but the barriers are real.”
GOVERNMENT COURTING GLOBAL PAYMENT GATEWAY FIRMS
Pakistan’s start-up funding has fallen sharply. According to Invest2Innovate (i2i), total funding dropped 70 percent in 2024 to just $22.5 million, reflecting global investment trends but also exposing structural weaknesses in the domestic ecosystem.
A senior official from the Ministry of Information Technology, speaking on condition of anonymity, said the government was in talks with at least three major global payment gateway companies.
“Freelancers’ income has doubled in just two years from around $350 million to $710 million,” the official said. “The actual figure may be above $2 billion because many take payments as tax-free home remittances.”
“This growth makes Pakistan a strong business case for PayPal, Stripe and others,” he added.
He said the government’s new start-up policy and the Pakistan Startup Fund (PSF), which offers non-equity grants of up to 30 percent of an investment round to match foreign funding, were designed to improve investor confidence and ease regulatory bottlenecks.
The State Bank of Pakistan did not respond to questions. Previously, the central bank raised foreign currency retention limits for IT exporters from 35 percent to 50 percent, simplified payment procedures and allowed freelancers to open bank accounts digitally with minimal documentation.
