Digital transactions continue growth trajectory in FY2022-23: SBP

The State Bank of Pakistan (SBP) said on Wednesday that digital transactions continued its growth trajectory in fiscal year 2022-23 as overall mobile and internet banking transactions witnessed an annual growth of 57% by volume and 81% by value.

It was revealed in the Annual Payment Systems Review for the fiscal year 2022-23 released by the central bank. The review presents growth and trends in banking transactions accompanied by the usage of payment systems’ infrastructure and instruments in the country.

As per the annual review digital transactions continued their growth trajectory owing to the increased consumers’ preference for digital channels of mobile and internet banking for meeting their financial needs.

E-Banking transactions through Banks and Microfinance Banks (MFBs) grew by 29% while value increased by 21% during the year, the Review stated adding that a growth pattern was also observed in Branchless Banking (BBs) transactions with a number of transactions increasing by 28% and value by 45% during FY23.

The SBP further stated that the number of e-banking users also increased significantly as the year saw an increase of 15% in internet banking users, 30% in mobile banking users and 42% in BB mobile app users.

Electronic Money Institutions (EMIs) also contributed meaningfully to the inclusion of digital banking users by opening more than 2 million e-wallets since their inception.

The e-banking was attracting more customers due to its efficient and instant payment solutions, and its transactions were growing at a steady pace over the years, the Review indicated adding that in contrast, paper-based transactions have declined by more than 4% during FY23 and cumulatively around 20% in last five years. However, value of paper-based transactions increased by 20% in FY23, it further added.

The Real-Time Gross Settlement (RTGS) system of Pakistan and Raast- Pakistan’s Instant Payment System, owned and operated by SBP- facilitates financial institutions and banking customers in processing and settling transactions.

During the year, RTGS processed 4.9 million transactions amounting to Rs.640.4 trillion, while 155 million transactions were processed on Raast amounting to PKR 3.2 trillion during this fiscal year.

Financial institutions are also strengthening their e-banking infrastructure by expanding Point-of-Sale (POS) terminals, Automated Teller Machines (ATMs), Cash/Cheque Deposit Machines (CDMs), e-commerce merchants and agents’ networks to meet customers’ needs, the SBP noted.

As of June 30, 2023, there were 115,288 POS terminals, 17,808 ATMs, 520 CDMs and 6,889 e-commerce merchants for providing payment services to the customers. During the fiscal year, the number of transactions through POS (199.3 million) and ATMs (809.7 million) grew annually by 45% and 17% respectively.

Domestic e-commerce transactions using payment cards were 31.8 million which amounted to Rs. 142 billion during the year, the review stated adding that as of June 30, 2023, there were 58.1 million payment cards in circulation of which 44.5 million were issued by banks and MFBs, 10.8 million by branchless banks, and 2.8 million by EMIs.