Pakistan's cashless shift accelerates as digital channels handle 92% of retail payments in Q1 of FY26

Pakistan’s shift towards cashless payments accelerated in the January-March 2026 quarter, with digital channels handling 92% of all retail transactions processed through formal banking and payment systems, according to the State Bank of Pakistan.

In its Quarterly Report on Payment Systems for January to March 2026, the SBP said 3.7 billion retail transactions worth Rs168.8 trillion were processed through formal banking and payment channels during the quarter. The report does not include transactions carried out outside the banking and payment system.

Retail transaction volume increased by 9% compared with the previous quarter.

Digital payments reached 3.4 billion transactions, amounting to Rs68 trillion. Mobile app-based payments remained the largest segment, with 2.9 billion transactions conducted through apps offered by branchless banking players, banks and electronic money institutions.

These app-based transactions accounted for 78% of all digital payments and were valued at Rs42 trillion. They included person-to-person transfers, bill payments, and account- and wallet-based merchant payments across online and physical retail outlets.

Internet banking also recorded growth, with transaction volume rising by 5% and value increasing by 19% during the quarter.

Raast Instant Payment System processed 742.1 million transactions worth Rs23.3 trillion during the quarter.

Raast person-to-person transactions increased by 10% to 664 million, with a value of Rs18.9 trillion. Raast person-to-merchant transactions rose to 55.9 million from 36.3 million in the previous quarter.

The report said 20,232 bank branches and 819,397 banking agents continued to provide over-the-counter services, including cash deposits, withdrawals, fund transfers and bill payments.

Bank branches processed 128 million transactions worth Rs99.5 trillion, while banking agents handled 155 million transactions valued at Rs1.1 trillion.

The SBP said the figures reflected Pakistan’s continued shift towards formal and digital payment channels.