KARACHI: Pakistan is moving quickly toward a cashless economy, and new numbers show the shift is picking up speed. Digital payments now make up the large majority of everyday transactions in the country, and the government says it plans to push even further in the coming months.
A Rising Tide of Digital Transactions
The State Bank of Pakistan said digital channels accounted for 92% of all retail transactions in the second quarter of the 2026 fiscal year. That is up from 88% a year earlier. The central bank’s Quarterly Report on Payment Systems, covering October through December 2025, found that people made 3.4 billion retail transactions during that period.
Retail transactions rose 8% from the previous quarter. Their total value climbed 7%, reaching 167 trillion rupees.
Cashless Pakistan Initiative Marks First-Year Milestones
The government’s Cashless Pakistan initiative, launched in June 2025, has passed several major milestones in its first year, according to the Finance Division. The number of merchants accepting digital payments has grown fourfold, from 500,000 to more than 2 million. Annual digital transactions have jumped from 6.9 billion to 11.3 billion.
More than 135 million people in Pakistan now use digital banking services, the Finance Division said.
Minister of State for Railways and Finance Bilal Azhar Kayani led a high-level meeting to review the initiative’s progress. The effort operates under three main goals: making things easier for the public, increasing transparency, and helping bring more of the economy into the formal, documented system. Three subcommittees oversee different parts of the work, covering digital payment innovation, digital infrastructure, and the digitization of government payments.
Financial inclusion in Pakistan has grown to 69%, the Finance Division said, and the gender gap in access to financial services is narrowing.
Government Sets New Digitization Targets
Kayani said the government has identified 25 major federal and provincial entities that will be fully digitized through the Raast payment system by December 2026. About 75% of government payment acceptance at centralized and self-accounting entities has already moved to digital systems, he said.
“The government remains committed to working closely with regulators, financial institutions, fintech companies and the private sector to expand digital payments, strengthen financial inclusion and support a transparent and documented economy,” Kayani said, according to a government statement.
Kayani also called for closer checks on reported progress, less duplication of effort, and stronger data reporting. An independent third party has been hired to review how well the initiative is being carried out, the Finance Division said.
Officials from the State Bank of Pakistan, the Federal Board of Revenue, the National Database and Registration Authority, the Pakistan Banking Association, Raast Payments Pakistan, commercial banks, telecom companies and fintech firms attended the review meeting.
Part of a Broader Shift
The push builds on years of steady growth in digital payments in Pakistan. Raast, the central bank’s instant payment system, has processed more than 892 million transactions worth 20 trillion rupees, or about $72 billion, since it launched in 2021.
Still, cash remains common in Pakistan, especially in the informal sector, where a large share of transactions still happen outside the banking system.
The State Bank has taken other steps recently to encourage cashless payments, including efforts to make transactions easier to trace and to reduce tax evasion and corruption. Airports across the country have also adopted a cashless model, requiring customers to use digital payment providers for services.
The State Bank’s broader roadmap, known as SBP Vision 2028, lays out plans to strengthen digital payment rules, build key infrastructure, improve cross-border remittances, encourage innovation, and push more government payments online.
