Only 3% of Pakistan Retailers Accept Digital Payments: SBP

Despite advances in digital payment infrastructure, Pakistan’s retail sector shows low adoption of point-of-sale (POS) systems, underscoring a continued dependence on cash transactions.

According to recent data from the State Bank of Pakistan (SBP), out of more than 5 million Micro, Small, and Medium Enterprises (MSMEs), only 151,000 retailers have installed POS machines. This means just 3% of retailers accept digital payments via POS devices.

Pakistan’s POS penetration stands at one device per 1,596 people, a stark contrast to countries like India with a ratio of 158:1 and Brazil with 10:1. The figures highlight a pressing need to scale digital payment options across the country’s retail sector.

To address this gap, Karandaaz Pakistan has introduced the “Raast Rapid Merchant Onboarding and Facilitation Entities (RMOFE)” initiative. The program focuses on enrolling a broad spectrum of physical retailers and service providers, especially in Tier 2 and Tier 3 cities, onto the Raast instant payment system.

Target Groups for Digital Payment Integration

The initiative targets various sectors, including:

• Traditional and modern retail shops such as kiryanas, grocery stores, pharmacies, supermarkets, and fuel stations
• In-person service providers like delivery agents, ride-hailing drivers, and food delivery workers
• Women merchants operating from physical locations

Raast provides affordable and interoperable payment methods, including Raast IDs, QR codes, and IBAN-based payments. To encourage merchants to adopt digital payments, the Merchant Discount Rate (MDR) will be zero during the project period, with costs funded through grants.

Eligibility and Partner Involvement

Only merchants engaged in ethical and lawful business activities can participate. Project partners are responsible for conducting due diligence during the onboarding process.

The program welcomes partners from diverse backgrounds, such as fintech companies, digital platforms, and non-banking service providers, who have the capacity to convert traditionally cash-heavy businesses to digital payment acceptance.

With just 3% of retailers using POS systems, Pakistan’s retail payments ecosystem remains heavily reliant on cash. The Raast RMOFE initiative aims to change this by making digital payments accessible and affordable, especially in underserved regions and sectors, helping to bridge the gap and modernize the country’s payment landscape.