Khyber Pakhtunkhwa moves to cashless economy with Digital Payment Act 2026

The Khyber Pakhtunkhwa government has introduced legislation to transition the province towards a cashless economy through the proposed ‘Khyber-Pakhtunkhwa Digital Payment Act 2026’, tabled in the provincial assembly during its previous session.

The draft law requires all businesses to adopt digital payment systems and display QR codes at shops and commercial centres to facilitate transactions. Educational institutions, clinics and hospitals will also be required to accept digital payments.

Under the proposed framework, customers will not be charged additional fees for using digital payment methods. Businesses that fail to comply with the requirements will face penalties.

The legislation authorises monitoring officers to conduct inspections of business premises to ensure implementation of the law. It also states that QR-based transactions are intended to improve documentation and support economic activity.

Newly registered businesses will be offered tax exemptions for a period of two years under the proposed law. Banks and service providers will be required to provide technical support to facilitate the transition.

The provincial government will also undertake measures to encourage citizens to adopt digital payment systems as part of the shift towards a cashless economy.