Qudsia Bano

Pakistan’s steady migration toward a cash-lite economy gathered unprecedented momentum in fiscal year 2024-25 as digital retail payments surged across every major channel. The Annual Payment Systems Review FY 2024-25 released by the State Bank of Pakistan (SBP) shows that the country processed 9.1 billion retail transactions worth PKR612 trillion, marking a 38 percent rise in volume and a 12 percent increase in value compared with the previous fiscal year.

For the first time, 88 percent of all retail payments were executed through digital channels ATMs, POS terminals, internet portals, and mobile-banking applications while only 12 percent took place at over-the-counter points or agent outlets. The SBP attributes this landmark to rapid smartphone adoption, fintech competition, and continuous policy support encouraging banks to expand digital access.

Pakistan’s payment infrastructure recorded significant growth. ATMs increased from 18,957 to 20,341, while cash-deposit machines nearly doubled to 1,038. POS terminals jumped 56 percent to 195,849, and QR-enabled merchants exceeded 1.09 million. The regulator observed that soft-POS technology smartphone-based acceptance was the principal driver of merchant expansion, enabling small traders to go cashless without expensive hardware.

The report shows that mobile-banking users climbed to 24.1 million, internet-banking users to 14.9 million, and branchless-banking app users to 79.2 million. Electronic-money wallets increased from 3.7 million to 5.8 million. EMIs processed PKR471 billion in transactions, nearly double the preceding year, while their value share within total digital payments rose to 29 percent from 21 percent in FY 2023-24.

The SBP emphasised that the rapid digitisation aligns with its Digital Pakistan Vision 2028, which seeks to formalise the economy, expand inclusion, and reduce reliance on cash. Digital payments enhance transparency in business activity and create reliable audit trails that help widen the tax base. Economists note that the 2024-25 data demonstrate the network effects of previous regulatory measures Raast, EMI licensing, and the introduction of instant-clearing mechanisms.

The digital wave also bridged urban–rural divides as low-value transactions via mobile and wallet accounts grew faster than high-value transfers. Agents in remote areas increasingly facilitated small bill payments and domestic remittances through branchless platforms, integrating previously unbanked citizens into the financial mainstream.

With the national digital infrastructure now covering nearly every district, SBP projects continued double-digit growth in electronic transactions during FY 2025-26. The review concludes that sustained fintech innovation and awareness campaigns will be essential to maintain trust and cybersecurity as Pakistan enters the next stage of its digital-finance evolution.

Credit: INP-WealthPk