Foodpanda’s $1.2 billion economic footprint revealed in LUMS study

LAHORE: A new study by the Lahore University of Management Sciences (LUMS) has revealed the scale of Foodpanda’s growing role in Pakistan’s economy, showing how digital platforms are transforming work, business, and access to services.

Titled “Economic Impact Assessment of Foodpanda in Pakistan”, the report estimates that the platform added $1.2 billion (around Rs334 billion) to the national economy during the 2023-24 financial year. But beyond the numbers, the study makes one thing clear: with the right policies, platforms like Foodpanda can do much more.

How Foodpanda is reshaping work and small businesses

Foodpanda is doing more than delivering meals. It has created new ways for people to earn a living, especially those who have limited access to traditional jobs. The report shows the platform helped generate Rs75 billion in revenue for over 13,000 restaurants, many of which are small or informal businesses.

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More than 7,000 HomeChefs, mostly women working from their homes, are now earning an average of Rs120,000 per month through Foodpanda. On the delivery side, over 50,000 freelance riders are using the platform to earn money on flexible schedules. And with over 6 million households using the app, more than 30 million people now have easier access to the meals they want, when they want them.

Transparency, taxes, and the formal economy

Foodpanda also paid Rs9.76 billion in taxes in just one year. But LUMS says the real value goes even deeper. By digitising payments and records, the platform brings more transparency to the entire supply chain. This encourages more informal businesses to enter the formal economy, helping to boost overall tax collection over time.

Policy roadblocks could slow growth

Despite this success, the report warns that outdated labour laws and strict rules could slow the progress of digital platforms. It urges the government to keep labour regulations flexible so that gig workers, many of whom value freedom and flexibility, can continue to benefit.

LUMS also advises against cutting off informal food vendors from the digital economy. Instead, it recommends working with platforms to help these businesses grow and formalise without disrupting their income.

Fixing internet issues and building support systems

Unreliable internet is another major hurdle. Service outages and slow speeds lead to delayed orders, lost income, and frustrated customers. The report calls for more investment in broadband networks, especially in underserved areas, as well as lower import duties on tech and incentives for local digital startups.

LUMS also raises concerns about the proposed Personal Data Protection Bill. If passed without changes, the law could force platforms to store data locally and limit cross-border data use. The study warns this would increase costs and discourage foreign investors.

To improve safety and ease compliance, the report proposes a one-window licensing system for riders that would handle ID checks, vehicle verification, and registration in one place.

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