The federal government has approved an annual subsidy of Rs3.5 billion to support large-scale adoption of Raast QR code-based payments at retail outlets. The subsidy aims to encourage merchants to shift from cash to digital payments, promoting financial inclusion and a cashless economy.
According to a news report, the Finance Ministry stated that under the Merchant Discount Rate (MDR) subsidy, banks, microfinance banks, and Electronic Money Institutions regulated by the State Bank of Pakistan (SBP) will receive 0.5% of each Raast QR transaction or Rs100 per transaction, whichever is lower. The institutions may also charge up to 0.25% of the transaction value for onboarding and servicing merchants.
The subsidy, which will be allocated through a Technical Supplementary Grant in the current financial year, is expected to support around Rs700 billion in merchant transactions annually. Merchants are required to display Raast QR codes at their outlets by August 31.
The initiative follows directives by Prime Minister Shehbaz Sharif during Steering Committee meetings on a cashless economy in July 2025. The government also proposed reducing import duties and taxes on payment acceptance devices and ensuring zero cost to merchants for using Raast QR codes.
The SBP, in consultation with stakeholders, developed the MDR Subsidy Scheme to accelerate the transition to a cost-effective digital payment ecosystem. At the end of the financial year, the SBP will submit a comprehensive report on merchant adoption, consumer usage, and transaction volumes to allow for potential modifications or continuation of the program.
The Economic Coordination Committee (ECC) approved the initiative and directed the SBP to present a detailed impact report in July 2026, covering transaction values, effectiveness of interventions, and recommendations for future enhancements.
