FATF sounds alarm on crypto regulation gaps
The Financial Action Task Force (FATF) has warned of the risks of virtual assets being used for money laundering, terror financing and other illicit activities, and stressed the need for urgent global action.
The Paris-based global financial watchdog called on countries to take stronger action to combat illicit finance in crypto assets, warning that gaps in regulation could have global repercussions.
It said that progress has been made since 2024 in regulating virtual assets, many jurisdictions still have work to do.
As of April 2025, only 40 of 138 jurisdictions assessed were "largely compliant" with FATF's crypto standards, up from 32 a year earlier, FATF said in a statement. "With virtual assets inherently borderless, regulatory failures in one jurisdiction can have global consequences," it added.
FATF also raised concerns about the use of stablecoins, a type of cryptocurrency pegged to fiat currencies, by "various illicit actors", including North Korea, terrorist financiers and drug traffickers. It said most illicit crypto activity now involves stablecoins.
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Business Recorder
5 hours ago
- Business Recorder
Careem's exit from Pakistan's ride-hailing market
In June 2025 Careem, the Dubai-based ride-hailing pioneer (now part of Uber), announced it would suspend its Pakistan operations on July 18 after nearly a decade in business. In a LinkedIn post Careem CEO Mudassir Sheikha called it 'an incredibly difficult decision,' attributing the withdrawal to 'the challenging macroeconomic reality, intensifying competition, and global capital allocation' that made it impossible 'to justify the investment levels required to deliver a safe and dependable service'. Careem's exit marks the end of an era for Pakistan's ride-hailing scene. The company – which helped introduce app-based booking, cashless payment and women's mobility to Pakistani cities – said it would continue other tech activities (including development of its regional 'Everything App') out of Pakistan. Nonetheless, the core taxi service itself is being wound down, underscoring deep strategic, operational, and economic headwinds in this market. Strategic and Operational Challenges in Pakistan From its launch in October 2015, Careem led Pakistan's nascent ride-hailing industry. It grew to over 12.5 million users and some 820,000 drivers in Pakistan before exiting. It offered a range of services (standard, premium, flexi bidding) and in-ride safety features, and even 24/7 helplines – at considerable cost. But over the last few years this position proved increasingly untenable. On the cost side, Careem repeatedly cited volatile fuel prices as a major constraint. Its local management noted that 'fluctuating fuel prices posed difficulties in adjusting fares to remain affordable for customers while ensuring fair payouts for captains'. Worsening that problem, Pakistan's road infrastructure is notoriously uneven: many highways and city streets are in poor condition, driving up vehicle wear-and-tear and maintenance costs. These factors squeezed Careem's margins. At the same time the company faced increased regulatory compliance costs. From its start, Careem had to work with authorities to legalize a new service model – as one spokesperson put it, being pioneers meant 'introducing the concept of ride-hailing in an unaccustomed market and navigating regulatory hurdles'. The industry even asked the government for special Standard Operating Procedures, fair taxation, and clearer rules for digital platform transportation. In this tough environment, scaling sustainably required constant adjustments (for example, Careem introduced a bid-based 'Flexi' pricing mode like its competitors, backed by shorter drives and dynamic demand models). But even those efforts could not fully offset the rising input costs and compliance challenges. Intensifying Competition Careem's exit also reflected a fierce competitive landscape. Over the last two years several new players have gained ground. The Russian-backed app Yango and the Latin American firm InDrive aggressively expanded in Karachi, Lahore and Islamabad, attracting price-sensitive riders with low fares and flexible bidding features. InDrive reports 26% year-on-year growth in rides and a 25% jump in active users in Pakistan during 2024, crediting its 'fair price' negotiated-fare model for winning market share. Careem introduced similar bidding mechanics, but even then analysis found Yango often had the cheapest promotional fares, making Careem relatively more expensive. Likewise, domestic start-ups filled niches: Bykea's motorbike-taxi network now handles millions of monthly rides in major cities, and even launched some four-wheel services. The upshot is that never-strong margins in emerging markets were squeezed even further. As the Economic Times noted, Ride-hailing giants worldwide (Uber, Lyft, Grab) have been 'exiting unprofitable markets, narrowing focus or pivoting to delivery' as 'rising costs, regulation, and thin margins in emerging markets' bite. Pakistan is no exception. One can also point to Uber's strategy shift as precedent. In late 2022, Uber announced it would cease its own app in five Pakistani cities (leaving only Lahore on its platform) and redirect users to Careem, its 2019 acquisition. Effectively Uber conceded to Careem in those markets. Uber said the change (announced amid a national economic crisis) was aimed at 'minimizing impact' on drivers and riders, as Pakistan grappled with floods and financial turmoil. Careem at the time became the sole on-demand transport platform for many customers. Yet even that consolidated position proved insufficient as new rivals eroded share. Reuters reports that 'newer entrants such as Russia-backed Yango and Latin America's inDrive have expanded in major cities, offering low-cost models,' coinciding with Careem's pullback. Economic and Macro Constraints Beyond competition, Pakistan's macro-economy has been exceptionally unforgiving. Since 2022 the country has endured a currency collapse, brutal inflation and dwindling investor confidence – creating an environment hostile to loss-making platform businesses. The Economic Times and Dawn both document that between 2022 and early 2024 Pakistani inflation surged to around 38% (far above the 5–10% typical range), before moderating in 2025. Consumer demand correspondingly fell; luxury or discretionary expenditures like ride-hailing softened as households grappled with high living costs. Venture funding for tech startups also dried up during the global and local downturn. Many local startups – including Airlift (hyperlocal delivery), Swvl (bus service), VavaCars (used cars) and Truck It In (logistics) – have already shut down or scaled back under the strain. As one analysis put it, Pakistan's digital economy has been 'under pressure' by record inflation and weak consumption. Careem's leaders explicitly cited this tough finance backdrop. The CEO noted that global capital flows into frontier markets have tightened, making it hard to justify further investment in a low-return project. In plain terms, pouring money to subsidize rides became untenable when both currency and income levels were unstable. Rising fuel costs (Pakistan imports much of its oil) and interest rates further squeezed margins. Industry participants like Bykea's founder even lamented that their $30 million in startup funding was a 'fraction of what was spent on the Islamabad metro bus project,' arguing that 'crowd-sourced mobility solutions' deserve more policy support than capital-intensive infrastructure. Careem's trajectory underlines this point: success depended not only on technology and service, but on macroeconomic stability and accessible capital. The business environment was complicated by Pakistan's regulatory landscape. While app-based taxi services offered clear safety and convenience advantages (real-time tracking, vetted drivers, cashless payment), they initially clashed with legacy taxi laws. Ride-hailing firms have long lobbied for fair taxation and clear rules. For example, industry associations urged the government for 'standard practices, reasonable taxation, and fair competition', arguing that these would encourage growth. Careem itself highlighted that its platform delivered 'significant public goods: digital infrastructure, trust, regulation, capability, [and] confidence,' building a foundation for future ventures. But persistent regulatory uncertainty and sometimes retroactive policy moves (like attempts to apply heavy levies on app operators) have weighed on long-term planning. Thus even after nearly $4?billion in payouts to Pakistani drivers (with $500?million of that in Pakistan), Careem could not secure the policy tailwinds needed for profitability. Comparative Market Context Careem's difficulties in Pakistan contrast with its broader success in other markets. The app remains a leading platform across the Gulf and North Africa: today Careem operates in 70+ cities across about 10 countries (the UAE, Saudi Arabia, Egypt, etc.). In the UAE (its birthplace) Careem coexists with Uber, typically weathering economic shifts better than in Pakistan. And in Egypt – a 100-million-person market – Careem competes closely with Uber and local apps, suggesting huge latent demand. Indeed, a 2019 Reuters report noted that in Egypt the 'biggest players are Careem and Uber,' and ride-hailing is seen as still in a growth phase thanks to underdeveloped public transport. By comparison, Pakistan's market is smaller and more brittle: fewer overall riders per capita, and far more severe currency and inflation cycles. This helps explain why Uber (Careem's owner) maintained investment in the UAE and Egypt, even as it withdrew from Pakistan. Notably, Careem had no substantial India presence, where Uber and domestic Ola dominate; that means Careem had little cushion from nearby South Asian markets. Regional competitors' experiences in Pakistan also illuminate the challenges. Global rideshare operators often rationalize out of markets where profits prove elusive. For instance, Uber's Middle Eastern arm recently exited markets like Algeria and Tunisia for similar reasons of low margins. InDrive, for its part, is doubling down on Pakistan, reporting double-digit growth – but even it acknowledges hurdles. inDrive Pakistan's PR lead noted that like others, they face 'regulatory hurdles, infrastructure limitations, and ensuring driver and passenger safety,' and have rolled out special insurance and driver support centers to cope. Yango (a less well-known app) has reportedly engaged in deep discounting and even currency manipulation to gain riders, raising questions about sustainability. All these firms are learning that high operating costs and macro headwinds can swamp rapid growth. Implications for Pakistan's Tech Ecosystem Careem's exit sends a sobering message to Pakistan's startup community. It underscores that global capital retrenchment and local economic challenges can quickly scuttle even successful platforms. Investors and entrepreneurs see that market potential alone isn't enough: reliable macro policy, exchange-rate stability, and supportive regulation are also critical. Already, experts have argued that the startup sector needs more domestic investment buffers, disciplined growth models, and government tech-friendly policies to survive a 'startup winter'. Careem's leadership, for its part, tried to highlight a positive note: its Pakistan tech workforce (nearly 400 engineers) will continue building a regional 'super-app,' with plans to hire 100 more local graduates. This suggests Pakistan remains a source of talent and a base for regional fintech ambitions, even if the ride-hailing chapter closes for now. For policymakers, the episode offers lessons. Ride-sharing has demonstrably created jobs, improved transport options, and even nurtured digital payments usage (Sheikha noted Careem 'helped normalize digital payments' in Pakistan). Sustaining such gains may require more stable tax and regulatory frameworks and perhaps public–private collaboration on digital infrastructure. As one local CEO pointedly remarked, gig-economy firms in Pakistan have raised modest sums compared to government spending on ill-fitting transit projects; he urged a shift of investment toward 'crowd-sourced mobility solutions' that leverage technology to serve commuters more efficiently. In the end, Careem's Pakistan withdrawal is a cautionary tale about the limits of ride-hailing growth amid economic slowdown. It confirms that structural issues – inflation, fuel shocks, poor roads, limited consumer spending and funding – can overwhelm market-leader advantages. As Pakistan's digital economy matures, the hope is that regulators and entrepreneurs alike take these signals to heart: build sustainable models, seek steady funding, and push for an enabling policy environment. Only then can future tech ventures avoid the fate of Careem's ride-hailing arm in Pakistan. Copyright Business Recorder, 2025
Business Recorder
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Nvidia insiders sold over $1 billion in stock amid market surge, FT reports
Nvidia insiders sold over $1 billion worth of company stock in the past year, with a notable uptick in recent trading activity as executives capitalize on surging investor interest in artificial intelligence, the Financial Times reported on Sunday. More than $500 million of the share sales took place this month as the California-based chips designer's share price climbed to an all-time high, the report said. Jensen Huang, Nvidia's chief executive, started selling shares this week for the first time since September, the SEC filing showed. Nvidia's stock hit a record on Wednesday, and the chipmaker reclaimed the crown as the world's most valuable company after an analyst said the chipmaker was set to ride a 'Golden Wave' of artificial intelligence. Nvidia chips make gains in training largest AI systems, new data shows Its latest gains reflect the US stock market's return to the 'AI trade' that fueled massive gains in chip stocks and related technology companies in recent years on optimism about the emerging technology. Nvidia did not immediately respond to a Reuters request for comment. Nvidia's shares have rebounded over 60% from their closing low on April 4, when Wall Street was reeling from President Donald Trump's global tariff announcements. US stocks, including Nvidia, have recovered on expectations the White House will reach trade deals to soften the tariffs.
Express Tribune
11 hours ago
- Express Tribune
Karachi slams attempt to block FCA relief
Listen to article Karachi-based industrialists and consumers have voiced serious concerns over the Power Division's interference in blocking relief and rescheduling K-Electric's (KE) hearing. Various stakeholders have approached the national power regulator, National Electric Power Regulatory Authority (NEPRA), urging it to reject the Power Division's request to deny Rs7.173 billion (Rs4.69/kWh) in Fuel Charges Adjustment (FCA) relief for April 2025 to KE consumers. They have also expressed serious concerns over the rescheduling of KE's hearing. Prominent Karachi-based energy expert and intervener Arif Balwani has written a letter to the power regulator opposing the Power Division's last-minute request to defer the FCA hearing for K-Electric. The hearing, originally scheduled for June 19, 2025, was rescheduled to June 23, 2025. NEPRA has now fixed June 30, 2025, for the next hearing. "It must be stated unequivocally that the FCA mechanism is a statutory and formula-based process under the NEPRA Tariff (Standards and Procedure) Rules, 1998. It is not a petition, nor does it entail discretionary regulatory indulgence warranting intervention," Balwani stated, adding that the authority's notice — consistent with past practice and law — rightly invited "interested/affected parties to submit written/oral comments as permissible under the law." He said that the notice did not — and could not — invite any intervention, which is governed by specific provisions and procedures applicable to tariff petitions or licensing matters under the NEPRA Act and relevant regulations. "The belated oral objection raised by the Power Division (PD) — during the hearing itself and without prior written noticeis procedurally improper, contrary to principles of natural justice, and has no basis in the NEPRA Act (XL of 1997), the NEPRA Tariff Rules, or any codified regulation," he said, adding that there is no statutory provision empowering the authority to suspend or defer a lawfully convened FCA hearing at the unilateral behest of an executive division lacking any regulatory jurisdiction. He further added that the PD's contention regarding the reference fuel price of Rs15.9947/kWh — derived from the previous Multi-Year Tariff (MYT) 2016-2023 — has been repeatedly used for interim FCA determinations without objection. The Power Division has acquiesced to the continued application of this reference benchmark for several months post-MYT expiry. It cannot now be permitted to challenge its validity retroactively without citing any contrary provision of law or proposing an alternative interim methodology. More critically, the Additional Secretary of the Power Division admitted on record that the request for deferral was not backed by any formal decision of the federal government, cabinet, or Economic Coordination Committee (ECC). Balwani said this renders the request ultra vires, lacking both authority and democratic legitimacy. The absence of any Cabinet directive further underscores that this initiative is an unauthorised executive overreach attempting to influence the statutory functions of an independent regulatorcontrary to the separation of powers enshrined in the Constitution. He said the Power Division's further assertionthat the negative FCA should not be passed on to KE consumers due to International Monetary Fund (IMF) programme constraintsis not only irrelevant in the context of regulatory law but also unsupported by any statutory or contractual obligation.
