The State Bank of Pakistan (SBP) has unveiled its Quarterly Payment Systems Review for the first quarter of FY25, covering the period from July to September 2024. The report showcases significant advancements in the country’s journey toward a cashless and digitally inclusive economy, with marked growth in digital payment adoption, infrastructure development, and a gradual decline in cash and paper-based transactions.
Retail payments during Q1 FY25 saw an 8% growth in volume, reaching 1,951 million transactions amounting to PKR 136 trillion. Digital channels continued to dominate, accounting for 87% of retail payments by volume. Transactions through digital platforms grew by 9% in both volume and value, with 1,699 million transactions worth PKR 36 trillion recorded during the quarter. These figures underscore the increasing public trust in digital payment systems.
Mobile banking apps emerged as a critical driver of this growth. Transactions through such apps reached 1,301 million, amounting to PKR 19 trillion, reflecting an 11% increase in volume and a 14% rise in value. The number of active mobile banking app users also grew by 4%, reaching 96.5 million compared to 93.0 million in the previous quarter.
E-commerce continued its upward trajectory, with online payments recording a 29% growth. Of the 118 million e-commerce transactions during the quarter, a staggering 91% were conducted through digital wallets, signaling a shift from traditional card-based systems. This trend highlights the growing preference for seamless, wallet-driven payment solutions.
Infrastructure development played a pivotal role in supporting this digital transformation. The number of Point-of-Sale (POS) terminals expanded to 132,224, facilitating 83 million transactions valued at PKR 429 billion. The ATM network also grew, with 19,170 units processing 243 million transactions worth PKR 3.9 trillion, maintaining its importance as a primary channel for cash withdrawals.
Efforts to bridge economic disparities through financial inclusion gained momentum. Branchless banking agents, numbering over 693,178, processed 28 million bill payments and mobile top-ups, alongside 75 million cash deposit and withdrawal transactions. Retail merchants accepting digital payments grew by 16%, driven by branchless banking initiatives that leverage mobile wallets, QR codes, and other digital tools.
The Raast instant payment system stood out as a key enabler of instant digital transactions. It processed 197 million transactions worth PKR 4.7 trillion during the quarter, enhancing the efficiency of payment systems for individuals and businesses alike.
The SBP’s report highlights the collaborative efforts of banks, fintech companies, payment service providers, and regulators in fostering innovation and accessibility within Pakistan’s payment ecosystem. These advancements are paving the way for a sustainable and inclusive financial landscape, empowering both individuals and businesses.
The SBP remains steadfast in its commitment to driving digital innovation and ensuring financial inclusion. The progress outlined in this review reflects Pakistan’s potential to transition toward a fully digital economy while building trust and reliability in financial services. This continued growth positions the country as a leader in adopting cutting-edge financial technologies, ensuring a brighter future for its economy and citizens.