Growth at the margins or a fundamental shift?

Before the pandemic, the number of point-of-sale (POS) machines in the country was pretty much stagnant. A POS machine uses a credit card or a debit card to process a payment instead of cash, according to data from the State Bank of Pakistan’s latest Payment Systems Quarterly Review. Covid-19 turbo-fueled the country’s drive towards digital adoption. The pandemic and the Russia-Ukraine war led the economy to a state where digitisation to increase the tax net was the only feasible path forward. The results of these efforts can be seen in the steep increase in the number of POS machines. Card-based transactions at POS terminals reached 83 million (5pc of digital payments) in the first quarter of FY25, amounting to Rs429bn. Combined, the POS machines process some 900,000 in-store purchases a day, as per the Payment System Review 1QFY25.