CHALLENGES IN THE ADOPTION OF MICRO PAYMENT GATEWAY (MPG) SYSTEM: EVIDENCE FROM DISTRICT ACCOUNTS OFFICES IN KHYBER PAKHTUNKHWA, PAKISTAN

Abstract

The growing trend of the digital governance has accelerated the adoption of electronic financial system in public sector organizations across developing countries. In Pakistan, the implementation of Micro Payments Gateway (MPG) system is considered a significant initiative toward improving transparency, efficiency and accountability in public financial management. However, the successful implementation of MPG system remains challenging due to institutional, technical and human resource barriers. This study examines the factors affecting MPG system adoption in District Accounts Offices of Khyber Pakhtunkhwa, Pakistan. Using a quantitative research approach, data were collected from employees working in District Accounts Offices through structured questionnaires. The findings reveal that institutional challenges such as lack of policy clarity, weak coordination and resistance to change significantly impede MPG adoption. Technical barriers including inadequate infrastructure, connectivity problems and cyber security concerns further constrain implementation. Human resource challenges, particularly limited digital literacy, insufficient training and lack of technical expertise, also negatively affect system utilization. The study further identifies top management support and digital readiness as significant moderating factors that reduce the negative impact of these challenges. The study contributes to the literature on digital governance and provides practical recommendations for policymakers and public sector administrators.

Keywords: Micro Payment Gateway (MPG), Digital Governance, Institutional Challenges, Technical Barriers, Human Resource Constraints.