Digital payments soar with 85pc dominance

In FY23, e-banking transactions constituted 85 per cent of total payments processed by banks and microfinance banks (MFBs), while the remaining 15pc were paper-based, according to the State Bank of Pakistan’s annual report on “Payment Systems Review- FY23”, released on Wednesday. This percentage increased from 80pc for e-banking and 20pc for paper-based transactions in FY22, indicating a gradual shift towards digital channels, possibly influenced by the post-Covid era where many customers adapted to digital channels for their daily financial needs. “It is still a formidable challenge in overcoming the ingrained preference for cash based transactions as evident from high currency in circulation (CiC) and the persistent influence of the informal economy, both of which continue to play a regressive role in the broader promotion of digital payments,” said the SBP. Banks and MFBs processed 2.073 trillion e-banking transactions worth Rs167.4 trillion during FY23, marking an annual growth of 28.6pc by volume and 21.4pc by value.