Millions of Pakistanis Cannot Afford Smartphones as Financing Options Remain Limited

Millions of Pakistanis remain unable to access the benefits of the digital economy because they cannot afford a smartphone or qualify for financing to purchase one.

Although mobile broadband networks cover a large part of the country, owning a suitable device remains a major obstacle for low-income households. High smartphone prices, limited access to credit and the lack of documented income make it difficult for many people to buy internet-enabled phones.

The problem is particularly serious for daily wage earners, informal workers, students and people who do not have conventional banking records.

According to the Pakistan Bureau of Statistics’ Household Integrated Economic Survey 2024–25, only 50% of people aged 10 and above owned a mobile phone, including smartphones. Ownership was approximately 70% among males and 30% among females.

Meanwhile, a GSMA report published in August 2025 estimated that mobile broadband networks covered around 80% of Pakistan’s population, but only 30% used mobile internet in 2024.

These figures highlight a major gap between network availability and actual digital access. Pakistan’s challenge is no longer just expanding mobile coverage. It must also make smartphones affordable and accessible to people who cannot pay the full price upfront.

Smartphone Affordability Remains a Major Problem in Pakistan

Smartphones have become essential tools for everyday activities.

People use them for banking, education, employment, communication, transport services and government facilities. Many businesses also depend on mobile applications to reach customers and manage payments.

However, rising handset prices have made ownership difficult for a large number of households.

A recent report published by Dawn on October 26 highlighted the sharp increase in smartphone prices in Karachi.

A basic handset with 4GB RAM and 64GB storage, which previously cost around Rs. 20,000 to Rs. 22,000, was being sold for approximately Rs. 35,000 to Rs. 40,000 in several markets.

The report also said major brands had increased handset prices by Rs. 15,000 to Rs. 30,000.

These increases have affected consumers who previously relied on budget smartphones.

Some buyers are now considering used or refurbished phones. Others are delaying purchases or choosing basic keypad phones because they cannot afford a suitable smartphone.

The problem is especially serious for families that need internet access for education, employment and digital payments but cannot justify spending a large part of their monthly income on a new device.

Only Half of Pakistanis Own a Mobile Phone

The Household Integrated Economic Survey 2024–25 provides an indication of the scale of the problem.

According to the Pakistan Bureau of Statistics, only half of people aged 10 and above owned a mobile phone.

The reported ownership figures also reveal a significant difference between men and women.

These figures refer to ownership of mobile phones, including basic handsets. They should not be interpreted as smartphone ownership rates alone.

The gender gap is particularly important.

Women who do not personally own a phone may face additional barriers when accessing digital banking, online education, employment opportunities and public services.

Improving smartphone affordability could therefore support broader financial and digital inclusion.

However, affordability is only one part of the problem. Digital literacy, network quality, online safety and access to reliable electricity also influence how effectively people use mobile services.

Why Are Millions of Pakistanis Unable to Buy Smartphones on Installments?

Installment financing can make expensive products more accessible by spreading payments over several months.

Instead of paying Rs. 40,000 or more at once, a customer could potentially purchase a smartphone through smaller monthly payments.

However, traditional financing systems often require documents that many low-income consumers cannot provide.

For example, banks and financing companies may ask applicants for:

• Salary slips or employment certificates.
• Bank account statements.
• Proof of regular income.
• Credit history.
• Identity verification and other supporting documents.

These requirements can create difficulties for people working in the informal economy.

Daily wage earners, shop workers, freelancers and self-employed individuals may receive regular income without having formal employment contracts or documented salaries.

Some may have sufficient cash flow to pay monthly instalments but still fail conventional credit checks.

This creates a gap between the ability to repay and the ability to prove repayment capacity.

Financing companies also face risks. They need reliable ways to assess customers, recover overdue payments and protect themselves against defaults.

As a result, many potential buyers remain outside existing financing arrangements.

Telecom Companies Want a New Smartphone Financing Framework

Pakistan’s major telecom operators have also pushed for a regulatory framework to support smartphone financing.

Jazz, PTCL/Ufone, Telenor and Zong jointly approached the Pakistan Telecommunication Authority (PTA) through a letter dated May 7, 2026.

The companies requested a framework that would make it easier to offer smartphones through installment arrangements while providing a mechanism to deal with customers who repeatedly fail to make payments.

The proposal included a graduated recovery process.

This could involve:

1. Payment reminders for customers who miss instalments.
2. Advance notifications before further action.
3. Opportunities to clear overdue payments.
4. A process for customers to dispute incorrect charges.
5. Additional measures for persistent non-payment.

The operators also suggested that SIM blocking could be considered as a last resort, subject to customer consent and consumer protection safeguards.

However, the proposed framework had not been finalised as of November 4, 2026.

This means consumers should not assume that a nationwide telecom-backed smartphone installment programme is already available under the proposed rules.

The government and PTA still need to address repayment enforcement, customer rights and the responsibilities of financing providers.

Can Open Banking Help Pakistanis Qualify for Smartphone Financing?

A separate development from the State Bank of Pakistan could help address one of the biggest barriers to smartphone financing.

On October 30, 2026, the SBP released draft Open Banking Regulations for public consultation.

The proposed framework would allow customers to share their financial information securely with authorised third parties through a consent-based system.

This could eventually help financing companies assess applicants using verified financial transaction records.

For example, consider a daily wage earner who receives regular payments through a bank account or digital wallet.

The person may not have a salary slip or conventional credit history. However, their transaction records could provide useful information about regular income and spending patterns.

Under an appropriate open banking framework, authorised lenders could potentially use such information to assess repayment capacity.

This approach may help people who are financially active but lack traditional employment documentation.

However, the proposed regulations are still at the consultation stage. Their final provisions, participating institutions and practical application to smartphone financing remain to be determined.

Open banking would also need strong privacy and security protections. Customers should understand what information they are sharing, who can access it and how it will be used.

Existing Smartphone Installment Services Are Available

Pakistan already has companies offering smartphones through installment arrangements.

One example is Kistpay, which provides device financing options, including partnerships with telecom operators.

However, the availability of existing services does not mean that every customer can qualify.

Financing providers must assess applications, determine repayment capacity and manage the risk of missed instalments.

The challenge is extending these services to people who have limited access to conventional credit.

A wider financing framework could help create more consistent arrangements across the market.

At the same time, consumers should compare the total amount payable rather than focusing only on the monthly instalment.

Processing fees, late-payment charges, insurance and other conditions can increase the final cost of a financed smartphone.

Local Mobile Phone Production Faces Its Own Challenges

Pakistan has developed a local mobile phone assembly industry, but production trends show that the market remains under pressure.

According to figures reported for January to September 2026, local mobile phone manufacturing and assembly declined by approximately 7%.

Production fell from 22.78 million units during the same period in 2025 to 21.08 million units in 2026.

Another important detail is the type of devices being assembled.

Around 60% of locally assembled handsets were basic 2G feature phones.

This reflects the continued importance of lower-cost phones in Pakistan’s market.

However, feature phones cannot provide the same access to applications, digital banking and online services as modern smartphones.

The figures suggest that local assembly alone has not resolved the affordability problem.

Pakistan needs a wider range of reasonably priced smartphones that meet consumers’ basic requirements without becoming financially inaccessible.

Smartphone Imports Increase Despite a Lower Import Bill

Commercial smartphone imports also recorded a significant increase.

During January to September 2026, commercial handset imports rose by approximately 90% to 2.85 million units.

Separately, the mobile phone import bill fell by 16.6% to $417.24 million during July to September of FY2026–27.

These figures cover different reporting periods and should not be compared as if they represent the same measurement.

Nevertheless, the combination of higher import volumes and a lower import bill may indicate a shift towards lower-priced imported devices.

This could provide additional options for consumers.

However, imported smartphones remain subject to applicable duties, taxes, exchange rate movements and distribution costs.

A sustained reduction in the price of entry-level devices will require improvements across the supply chain.

Bangladesh Is Considering Measures to Expand Affordable Smartphone Access

Pakistan is not alone in facing this challenge.

Bangladesh is also considering measures to move consumers from basic handsets towards more advanced mobile devices.

Its telecom regulator has proposed phasing out 2G services by December 31, 2029, subject to government approval.

More than 60 million people in Bangladesh were still using 2G devices, according to the report.

Authorities are exploring several possible measures to support the transition, including:

• Affordable locally manufactured smartphones.
• Installment-based purchasing.
• Targeted subsidies.
• Tax relief.
• Greater access to digital services.

The experience highlights an important issue for countries expanding mobile internet access.

Reducing the price of smartphones is essential if people are expected to move from basic phones to internet-enabled devices.

However, any transition away from older networks must be planned carefully so that low-income users are not disconnected before affordable alternatives become available.

What Can Pakistan Do to Make Smartphones More Affordable?

Pakistan needs a combination of measures rather than relying on installment financing alone.

Several steps could help improve smartphone ownership.

1. Reduce the Cost of Entry-Level Smartphones

The government could review applicable duties and taxes on affordable smartphones.

Any tax relief should be designed carefully to encourage access to basic devices without creating unnecessary pressure on public revenue.

2. Introduce Transparent Installment Plans

Financing providers should clearly disclose the cash price, total installment cost, processing fees and penalties.

Customers should be able to compare offers before signing an agreement.

3. Improve Credit Assessment

Alternative financial information could help lenders assess customers who lack traditional salary records.

The SBP’s proposed Open Banking Regulations may provide a foundation for this approach, subject to final approval and appropriate safeguards.

4. Protect Customers Against Unfair Recovery Practices

A smartphone financing framework should include clear payment reminders, dispute resolution, hardship arrangements and advance notices.

Any restriction on a financed device or mobile service should follow transparent rules and proper consumer protections.

5. Encourage Affordable Local Manufacturing

Local manufacturers and assemblers could help expand the supply of entry-level smartphones.

A stable policy environment, access to components and competition among brands would be important for keeping prices manageable.

Conclusion

Millions of Pakistanis remain excluded from the digital economy because they cannot afford a smartphone or qualify for financing.

Official household survey figures show that only 50% of people aged 10 and above owned a mobile phone in 2024–25. Meanwhile, mobile broadband coverage has expanded much faster than actual internet usage.

High handset prices, limited credit access and the lack of documented income continue to prevent many households from purchasing suitable devices.

Telecom operators have requested a regulatory framework for smartphone financing, while the State Bank’s proposed Open Banking Regulations could eventually help lenders assess customers through verified financial records.

However, neither development has yet resolved the wider affordability problem.

Pakistan will need more affordable entry-level smartphones, accessible financing, clear consumer protections and stronger digital literacy programmes.

Expanding network coverage is important, but meaningful digital inclusion also requires people to own devices they can afford.