Pakistan banking assets rise from Rs25 billion to Rs69 trillion since 1970s: report

Pakistan’s banking sector expanded sharply over the past five decades, with total monetary assets increasing from less than Rs25 billion in the early 1970s to more than Rs69 trillion by 2021, according to a Gallup Pakistan report based on State Bank of Pakistan (SBP) data.

The report, “Long-Run Pakistan Analysis on Financial Development Structure (1970–2021)”, traces the evolution of the country’s financial system from a small cash-based economy to a larger banking network.

Currency in circulation increased from about Rs5.4 billion in 1972 to more than Rs7.3 trillion by 2021.

Bank deposits with scheduled banks rose from Rs19.2 billion in 1972 to over Rs13 trillion by 2021. Deposit growth accelerated after the early 2000s following banking reforms, technological changes and wider access to financial services.

Foreign exchange reserves, including gold, increased from about Rs3.1 billion in 1972 to roughly Rs3.9 trillion by 2021, though the level fluctuated due to external economic conditions.

“The expansion in Pakistan’s monetary aggregates over the past five decades reflects a clear trend of financial deepening and economic growth,” said Arif Habib Limited economist Sana Tawfik.

She said higher remittances and periods of elevated interest rates also contributed to deposit growth.

The report also shows increasing concentration of deposits and credit in accounts holding more than Rs1 million, a trend that became more visible after 2010.

At the same time, the data indicates challenges in financial inclusion, as many small savers and borrowers remain outside the formal banking system and cash transactions remain widely used.