The State Bank of Pakistan said on Tuesday that retail payments through formal banking channels rose to 14.3 billion transactions in the fiscal year ended June. The central bank said those transactions were worth Rs673 trillion in that fiscal year.

Digital channels made up more than 92 per cent of the total, the central bank said. Retail payment transaction volumes in Pakistan rose 58 per cent in FY26, the State Bank of Pakistan said in the review.

The value of those retail payment transactions increased 10 per cent in the same fiscal year, the central bank said. The figures were published in the State Bank of Pakistan's Annual Payment Systems Review.

The State Bank said retail payments are routine, mostly lower-value transactions by individuals, merchants and businesses. It distinguished them from large-value transfers settled through systems such as PRISM+.

The State Bank attributed the shift toward digital channels to affordable digital technologies and wider access to banking services. It also cited changing customer preferences, greater interoperability, and an enabling regulatory environment.

The report said the growing adoption of mobile phone banking continued to be the most important driver of digital payments. Mobile channels handled 11.1 billion transactions during the year.

That mobile total was a 79 per cent increase in volume, the State Bank said. Internet banking recorded over 0.3 billion transactions worth Rs61 trillion, the review said.

Internet banking was up 15 per cent in volume and 55 per cent in value. The Prime Minister's Cashless Pakistan Initiative and the instant payment system Raast served as key catalysts for the transition, the State Bank said.

Under the initiative's subsidy programme, QR-enabled merchants tripled to 3.8 million by June 2026, the review said. The point-of-sale network expanded 49 per cent to 337,791 merchants.

Daily card payments at point-of-sale outlets reached nearly 1.5 million, the State Bank of Pakistan said. E-commerce merchants increased to 23,356, the Annual Payment Systems Review reported.

ATMs rose 7 per cent to 21,678, according to the review. Cash and cheque deposit machines nearly doubled to 1,896.

A major infrastructure development was the introduction of PRISM+ in August 2025, the State Bank of Pakistan said. The introduction transitioned the RTGS system to the ISO 20022 standard, the central bank said.

The digital share of payments by value rose to 38 per cent, the Annual Payment Systems Review said. That digital share by value climbed to Rs257 trillion from Rs179 trillion, the State Bank reported.

The State Bank said this would require continued efforts to facilitate the digitisation of higher-value transactions across businesses, government entities, and financial institutions.