ECC approves PKR 3.5B for Digital Payments Under Cashless Economy Drive

The Economic Coordination Committee (ECC) has signed off on a PKR 3.5 billion package to make digital payments easier and cheaper in Pakistan. The package, approved on Tuesday under a Technical Supplementary Grant (TSG), will cover the current financial year and continue for three years.

The meeting, chaired by Finance Minister Muhammad Aurangzeb, focused on boosting cashless transactions. The grant will subsidize charges on the RAAST QR code system, a State Bank of Pakistan platform that lets shoppers pay merchants directly through their phones.

Cheaper Payments for Merchants

One of the biggest hurdles for small retailers has been the Merchant Discount Rate (MDR), a small fee on every digital payment. By absorbing this cost, the government hopes to make it worthwhile for shopkeepers to accept QR payments instead of sticking to cash.

“In simple terms, the government is footing the bill so that digital payments can spread faster,” said one official familiar with the decision.

The State Bank of Pakistan has been told to roll out the scheme immediately. It will also prepare a full report by the end of the fiscal year on how well the subsidy worked and how many new merchants joined the system.

Cashless Economy Pakistan: Why It Matters

Pakistan has seen steady growth in mobile banking and fintech apps, but most daily transactions are still cash-based. Experts believe that lowering costs, improving awareness, and ensuring reliable internet access will be key to making the scheme successful.

If momentum builds, the subsidy could help bring more citizens into the formal economy, make payments quicker, and reduce the risks of an overreliance on cash. The government has been rolling out several measures in recent months to push Pakistan toward a cashless economy. The latest subsidy is another move to speed up digital payments, and with digitalization now a policy priority, more such initiatives are expected in the months ahead.

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