Retail transactions in Pakistan surged by 4.2 percent in volume and 22.4 percent in value during the quarter that ended on 30 September 2023, according to the State Bank of Pakistan’s (SBP) quarterly report on Payment Systems in the country.
In terms of volume, 1.4 million Large Value Payments (LVPs) were settled by RTGS amounting to Rs. 199 trillion, whereas, retail transactions processed by banks, MFBs, and EMIs during the quarter were 702 million with a value of almost Rs. 134 trillion.
Retail transactions mainly comprised funds transfers (37 percent), cash withdrawals (36 percent), purchases at POS & e-commerce platforms (10 percent), bill payments & mobile top-ups (7 percent), cash/cheque deposits (7 percent), and 3 percent rest of the payments.
Fund transfers were the most prevailing transaction on digital channels by volume, while on OTC, cash/cheque deposits were the most prominent transaction mode.
All these retail transactions were facilitated by the payments network provided by the banks, MFBs, and EMIs. This included a network of 17,768 bank branches, 18,117 ATMs, 118,444 POS terminals, and 7,310 registered e-commerce merchants (with banks/MFBs).
The report highlights key advancements within the country’s payment ecosystem and provides an inclusive overview of digital transactional activities.
Regarding digital platform users, there were 17.0 million mobile banking users, 10.3 million internet banking users, 2.4 million e-wallet holders (issued by EMIs), and 61.3 million m-wallet holders (issued by BB service providers) by the end of the quarter.
Alongside this, there were 54.3 million payment cards issued to customers of which 79 percent were debit cards, 17 percent were social welfare cards and 4 percent were credit cards.
The share of digital payments in retail transactions of the banking system increased to 80 percent during the quarter in comparison to 74 percent in the same quarter of last year.
While the share of over-the-counter (OTC) transactions was 20 percent in retail transactions this quarter, its share by value was 87 percent indicating customers’ preference for OTC channel for higher value transactions.
As of quarter-end, there were 33 Banks, 11 Microfinance Banks (MFBs), 4 Electronic Money Institutions (EMIs), and 5 Payment Service Providers/ System Operators (PSOs/PSPs) providing payment services across the country.
In addition, the Real-time Gross Settlement System (RTGS) and Raast – an instant payment solution, both operated by SBP, further enrich the country’s payment infrastructure. Moreover, 16 banks and MFBs extended their offerings to Branchless Banking (BB) services thereby expanding the accessibility of the financial services.
