Page 28 - CMA Journal (July-August 2025)

Focus Section Digital Payments
Focus Section
in Pakistan:

Progress and

Challenges

Currently, the payment system has two major types: the branchless banking
traditional cash-based system and the digital payment and digital payments,
system. Globally, the digital payment system is making serving people who do
fund transfers easier compared to the traditional not have access to
cash-based system. It works as an electronic method of traditional banking.
transferring payments; for example, net banking Ordinary users with
applications, debit and credit cards, mobile wallets, and Android phones and
blockchain-supported systems. In Pakistan, the internet access are
government is continuously trying to expand the use of using these platforms
digital payments through different stakeholders like the for payments such as
State Bank of Pakistan, commercial banks, and telecoms. utility bills, mobile
top-ups, and fund
More than 100 million people have access to mobile and Muhammad Tanveer
transfers.
internet services in Pakistan, which is helping to increase Ul Qamar, FCMA
the adoption of the digital payment system. However, From 2011 to 2020, the CEO, Allied Financials
there are still many obstacles in this process, such as low government gradually
literacy levels, slow infrastructure development, shifted the payment of salaries and pensions to the digital
regulatory issues, cybersecurity threats, and scams. In banking system. During COVID-19, it became necessary to
this article, we will discuss the current system of digital introduce a contactless banking system in Pakistan. In
payments in Pakistan, ongoing development progress, 2021, the Government of Pakistan introduced RAAST to
and the challenges to achieving the target of a fully strengthen the digital payment system, Roshan Digital
functional digital payment system. Accounts (RDA) for overseas Pakistanis, and the PayPak
Developments Card for domestic transactions. RAAST is the first online
payment system in Pakistan designed to support digital
In the early 2000s, the banking system was limited to a payments. Similarly, Roshan Digital Accounts (RDA) allow
few banks operating in Pakistan with a small number of non-resident Pakistanis to invest in Pakistan’s economy,
branches. Most people were not able to access the which ultimately improves foreign reserves and
internet or the banking system due to low awareness and strengthens the digital payment ecosystem.
weak internet infrastructure. By 2010, there were five
national banks, twenty-five private banks, and six As of March, the total number of banks is 55, with 18,450
international banks working in Pakistan. A major branches of all commercial banks, Microfinance Banks
breakthrough in branchless banking came with the (MFBs), and Development Financial Institutions (DFIs)
introduction of Easypaisa (Telenor Microfinance Bank). operating in Pakistan. The total number of ATMs stands at
Later, JazzCash was launched by Mobilink Microfinance 18,957 to facilitate digital payments. This increasing trend
Bank, and Upaisa by U Microfinance Bank. Currently, in the banking system shows major development in both
JazzCash and Easypaisa hold the largest share in the banking sector and the digital payment system.

26 ICMA’s Chartered Management Accountant, Jul-Aug 2025