Digital payments hit two billion, dominate 89pc of retail transactions

By Staff Reporter

KARACHI: Digital payments in Pakistan reached 2 billion transactions in the third quarter of fiscal year 2025, capturing 89% of total retail payments, as the country’s shift to a cashless economy gained momentum, the State Bank of Pakistan (SBP) reported on Wednesday.

The central bank’s Quarterly Payment Systems Review for Q3 FY25 showed retail payment volumes jumping 12% to 2.408 billion transactions, with their total value climbing 8% to Rs164 trillion ($591 billion). Digital channels led the charge, handling 89% of transactions, while over-the-counter methods like bank branches and agents managed the remaining 11%. By value, OTC channels held a 71% share, or Rs117 trillion, dwarfing digital’s 29%, or Rs48 trillion.

Mobile apps fueled the boom. Mobile banking, branchless banking wallets, and e-money wallets processed 1.686 billion transactions worth Rs27 trillion, up 16% in volume and 22% in value from the prior quarter. User growth tracked the trend: mobile banking app use rupee rose 7% to 22.6 million, branchless wallet use rupee increased 6% to 68.5 million, and e-money wallet use rupee jumped 12% to 5.3 million. Internet banking use rupee also grew 7% to 14.1 million.

E-commerce payments exploded, with volumes surging 40% to 213 million and value rising 34% to Rs258 billion. Digital wallets ruled this space, claiming 94% of transactions (199.1 million), while card-based payments trailed at 6% (13.5 million).

In-store spending kept pace. A network of 179,383 POS terminals, run by 140,861 merchants, processed 99 million transactions worth Rs550 billion, up 12% in volume and 8% in value. QR code payments added 21.7 million transactions valued at Rs61 billion.

The central bank’s infrastructure underpinned the shift. The Raast instant payment system handled 371 million transactions worth Rs8.5 trillion, pushing its totals since launch to 1.5 billion transactions and Rs34 trillion. The Real-time Gross Settlement System cleared 1.5 million large-value payments totaling Rs347 trillion.

Banks, fintechs, and payment provide rupee, backed by the SBP’s push for financial inclusion and efficiency, drove the digital wave. The central bank said the expansion signals a maturing digital economy.