- Raast and mobile banking systems processed record transactions, driving Pakistan’s digital payment growth
The economists recorded that Pakistan stands at a promising crossroads to target growth 2.0. The year 2025, marking the second quarter of the incumbent International Monetary Fund (IMF) programme, begins on a stronger footing. Even the exchange rate shows newfound stability, steady at Rs 278 to the dollar.
Presently as per the State Bank of Pakistan (SBP), Pakistan has a well-developed digital payments ecosystem comprising of a well-functioning real Time Gross Settlement (RTGS) system, a state of the art instant payment system, Raast, 24/7 online digital payment systems offered by 1Link and other Payment System Operators, fully interoperable ATM and POS networks, QR Code enabled payment solutions, Electronic Money Institutions (EMIs), Payment Service Providers (PSPs), digital on boarding mechanisms for customers and merchants, and an emerging Fintech sector.
The Payment Systems Review provides an overview of key developments in the national payment ecosystem, emphasising the increasing adoption of digital transactions during the 1st quarter (July-September) of FY2025. The major highlights of the quarter include:
Retail transactions: SBP recorded that Increased by 8 percent in volume reaching to 1,951 million amounting to Rs 136 trillion during the quarter. Digital channels processed 87 percent (1,699 million) of all retail transactions, whereas over-the-counter (OTC) channels accounted for the remaining 13 percent (251 million). In terms of value, share of digital payments grew from 24 percent in Q4 FY2024 to 27 percent (Rs 36 trillion), while share of payments through OTC channels were 73 percent (Rs 100 trillion).
Raast instant payment system: Since inception in 2022 till the quarter-end Q1 FY2025, Raast has processed 848 million transactions amounting more than Rs 19 trillion and is growing at a consistent pace. During Q1 FY2025, both volume (197 million) and value (Rs 4.7 trillion) of transactions grew by 17 percent as against to Q4 FY2024, with daily transactions touching the mark of 3 million transactions a day. As of quarter-end there were 39.5 million registered Raast IDs.
Mobile app-based payments: Mobile App-based banking was the prominent contributor to the increase in digital payments. Payments through these banking apps accounted for 77 percent of all digital transactions by volume and 51 percent by value during the quarter. These apps include banking apps provided by banks and MFBs, and app-based wallets provided by branchless banking service providers and EMIs. A total of 1,301 million payments of Rs 19 trillion were made during the quarter having quarterly growth of 11 percent by volume and 14 percent by value with an average ticket size of Rs 14,400 per transactions. It is pertinent to mention that BBs provided mobile apps were the major contributor in the continuous growth in mobile app payments contributing to 70 percent of these transactions. Registered users on these apps increased to 96.5 million from 93.0 million (Q4 FY2024) at a quarterly growth of 4 percent.
Internet banking portals: A total of 60 million transactions amounting Rs 7.5 trillion, or 4 percent of digital payments by volume and 21 percent by value were conducted through internet banking portals during the quarter. Usually, payments through internet banking has a higher ticket size (Rs 125,000/ transaction) than that of mobile app banking due to the digital payments by the corporate businesses. Users of internet banking portals have increased by 3 percent to 12.4 million.
ATM usage: Transactions through ATMs constitute a share of 14 percent by volume and 11 percent by value of total digital transactions. The infrastructure of 19,170 ATMs, equating to 13 ATMs per 100,000 adults, across Pakistan facilitated 244 million transactions amounting to Rs 3.9 trillion, predominantly for cash withdrawals (98 percent). On an average, each ATM handled 12,700 transactions per quarter or 138 transactions a day. Average ticket size of cash withdrawal via ATMs was Rs 14,900/transaction. Approximately, 37 percent of the ATMs have active bio-facility allowing customers to withdraw cash.
Point-of-Sales (POS) terminals: Card-based transactions at POS terminals reached 83 million (5 percent of digital payments) amounting to Rs 429 billion during the quarter, growing steadily at a quarterly average growth of 9 percent by volume and more than 3 percent by value. Number of POS machines have increased to 132,224 as of quarter-end processing 900,000 in-store purchases a day.
E-commerce: Digital e-Commerce continued its rising trajectory. More than 118 million online ecommerce payments were made during the quarter showing a growth of 29 percent by volume amounting to Rs 148 billion with a quarterly growth of 23 percent. Of total digital e-commerce payments, 11 million (9 percent) were made through cards, while 107 million (91 percent) through digital wallets/accounts. During the previous quarter, this share was 11 percent for card-based and 89 percent for wallet/account-based e-commerce.
Payment cards: As of quarter-end, 55.6 million payment cards were in circulation, with debit cards comprising 88 percent of the total. Merchants: During the quarter, merchants accepting payment cards via POS terminals has increased by 5 percent to 104,281, while, number of e-Commerce merchants has expanded to 8,189 from 7,816 (Q4 FY2024) marking a quarterly growth of 5 percent. BBs enabled retail/kiryana store merchants1 have increased to 597,411 with a growth of 16 percent during the quarter and processed 21 million payments of Rs 53 billion. Around 93 percent of these merchants are also accepting payments through Raast QR.
Branches and agents: Alongside 18,623 Bank branches, there are 693,178 BB agents specifically catering to the rural and underserved areas. These agents facilitated 28 million bill payments and top-up, 64 million cash deposit, 11 million cash withdrawal and 8 million other transactions.
Large-value transactions: The RTGS system settled 1.6 million large-value transactions totaling to Rs 278 trillion marked a quarterly growth of 13 percent in volume and 9 percent in value during the quarter.