Page 80 - CMA Journal (July-August 2025)

SECTOR BRIEF

S B

Digital Payments and E-commerce Sector of Pakistan

By ICMA Research and Publications Department

FATF compliance has driven the growth of Pakistan’s the State Bank of Pakistan, in partnership with banks,
fintech and digital commerce sector, with e-commerce EMIs, and fintechs, is promoting financial digitization. To
becoming a key competitiveness driver. The COVID-19 enhance transparency and efficiency, PM Shehbaz Sharif
pandemic further accelerated this trend, with digital has formed three high-level committees to expand
payments now accounting for 89% of retail transactions digital payments nationwide and scale the RAAST system
in Q3 FY25. Pakistan’s young population, high mobile across provinces, which is projected to reach US$6.7
penetration, and expanding broadband access offer billion by 2029, growing at a 5.92% CAGR.
strong potential for inclusive digital growth. In response,

HISTORICAL OVERVIEW

PEERIOD PHASE TITLE DESCRIPTTION
C
n
u
;
19622-2001 Fou a arly The Copyright Ordinance (1962) laaid the foundaa ectual Propertty Rights (IPR);
s
r
Infrastructure NIFT was established in 1995 for eelectronic cheqque clearing; aand in 2001, thhe Trademarks
w
Ordinance and SBP’s core bannking automa on advancedd e-commerce and digital
l
a
t
infrastructure.
E
l
a
20022-2004 Dig g o ons & The Electronic Tra ddinance (20022) granted lee on to digital
M
ATM y y transa a 0 03 1LINK was launched forr ATM interopperability; and by 2004 SBP
P
N
mandated 1LINKMNET interconnee nn ATM access.
P
f
20077-2012 Legal Reforms & The Payment Systems and Electrronic Fund Traansfers Act (2007) gave SBPP oversight of
g
Digital Financial electronic payments; in 2008, PRISM RTGS and Branchlesss Banking Regg e e
g
Services Growth introduced; from 2009-2012, EassyPaisa, BISP’ss digital rollouut, and MobiCCash launched,
d
r
,
while SBP’s 2012 ATM mandate acc oonwide accesss.
e
o
20144-2016 Alliances, Inclusion & In 2014, Pakistan joined the UNN nn Cash Alliancce and standardized cheque
o
i
1
Digital Moderniza security, the al Financial Incclusion Strateggy (2015) and internet banki s s
i
g
a
n
enhanced inclusion; 2016 saw the launch of PayPPak as a dome mme.
,
20177-2020 Crypto Ban, EMV Key developments included SBP’s ban on virtuaal currencies likke Bitcoin, Liteecoin, Pakcoin,
y
V
e
C
n
Compliance & NPSS and ICOs due to financial and legaal risks, increassed EMV comppliance, and COOVID-19-driven
P
a
m
Launch z z e ember 2019, SBP launched the ll Payment Sysstems Strategy
u
y
(NPSS) to modernize e PPakistan’s paymment infrastruccture.
S
2
g
r
4
20211-2023 Digital Payment In 2021, Pakistan ranked 37th in e-commercee with US$5.99 billion saless and US$174
Ecosystem Expansion million funding (25% of total inveestment), alonggside the launch of RAAST BBulk Payments.
o
%
n
.
d
2
& L L In 2022, RAAST P2P enabled instant, no-fee trannsfers, and by 2023, e-commmerce captured
Tra a 34.4% vestment.
%
20244-2025 Advancing Digital The Electronic Tran of 2024 estabblished a legaal framework for electronic
c
v
n
E
Governance & transa a nizing digital documents aand communii 22025, Pakistan
v
n
Payments Framework enacted the Digital ttan Act (DNPA)) to recognize e-contracts and signatures,
y
e
,
w
.
P
created the Digital Pakistan Authoority, and alignee with global traade standards.
e
e
a
The Pakistan Virtual Assets Reguulatory Authoriity (PVARA) wwas also launchhed under the
P
,
a
n
Virtual Assets Ordinance 2025. Too promote finaancial transparency and digital payments,
e
s
Prime Minister Shehbaz Sharif formed threee key commi ees: the Diggital Payments
a
Innova o o ee, the Digitaal Public Infrastructure Comm (under
r
M
the Ministry of IT), and the Goverrnment Paymee ee (Cashless Pakkistan Steering
g
a
m
Comm h he PM’s Secretaariat).
78 ICMA’s Chartered Management Accountant, Jul-Aug 2025