In a transformative stride towards a digital economy, Pakistan's payment ecosystem has witnessed a significant surge as highlighted in the latest Quarterly Payment Systems Review released by the State Bank of Pakistan (SBP) for the second quarter of the fiscal year 2023-24. The report underscores a remarkable expansion in the user base of digital payment platforms, reflecting the nation's increasing reliance on mobile and internet banking. With mobile and internet banking users reaching 16 million and 11 million, respectively, registering quarterly growth rates of 8% and 5%, Pakistanis are embracing the convenience and accessibility offered by digital transactions. A noteworthy development is the upsurge in e-wallets registrations with Electronic Money Institutions (EMIs), witnessing a robust 15% increase to 2.7 million. Moreover, over 67 million m-wallets were registered with Branchless Banking (BB) service providers, further indicating the growing penetration of digital financial services.

During 2QFY24, retail transactions processed by banks, Microfinance Banks (MFBs) and EMIs observed a substantial quarterly growth of 15%, a notable escalation compared to the 5% growth in the previous quarter. Digital transactions constituted a dominant 82% of overall retail transactions, reflecting the populace's increasing preference for cashless payments. However, in terms of value, over-the-counter (OTC) transactions retained an 85% share of overall retail transactions. “The increasing adoption of digital transactions not only enhances efficiency but also fosters transparency and resilience in the economy, laying a solid foundation for sustainable growth and prosperity. As the country embraces digital transformation, the momentum in the digital payment is poised to accelerate, paving the way for a more inclusive and resilient financial future,” said Shahid Javed, a senior economist at SBP.

He said the pivotal role played by digital payment solutions such as Raast (Instant Payment System) and PRISM (Real-Time Gross Settlement System) cannot be overstated. “Raast facilitated a staggering 107 million fund transfer transactions, amounting to over Rs2 trillion, in 2QFY24, while PRISM processed 1.5 million large-value payments, totalling R273 trillion. These systems have become instrumental in fostering financial inclusivity and efficiency nationwide.” “The accessibility and convenience offered by digital payment platforms is instrumental in bringing millions of unbanked and underserved individuals into the formal financial system. This not only expands access to financial services but also promotes economic empowerment and social upliftment,” said Javed.

Credit: Independent News Pakistan