SBP Asked to Report on QR-Based Payment Subsidy

The government has taken another step to boost digital payments in Pakistan. It has asked the State Bank of Pakistan (SBP) to prepare a detailed report on the impact of the subsidy allocated for QR-based payment.

During a recent meeting of the Economic Coordination Committee (ECC), the SBP informed the members about earlier decisions of the Steering Committee on Cashless Economy. It was decided that Rs3.5 billion would be set aside each year to support the large-scale adoption of Raast person-to-merchant (P2M) QR payments.

SBP Asked to Report on QR-Based Payment Subsidy

The Finance Division advised that a comprehensive report should be prepared. This report will include the impact of the subsidy, proposals for improvement, and suggested changes. The ECC has directed the SBP to present this report by July 2026.

The Ministry of Finance highlighted that the aim is to make digital transactions affordable and attractive. By providing targeted support through a Merchant Discount Rate (MDR) subsidy, the government wants to promote financial inclusion and reduce dependence on cash. This subsidy will lower the costs for merchants and encourage them to adopt digital payment methods.

The meeting was also informed that Prime Minister Shehbaz Sharif, during a steering committee session on July 3, 2025, issued several directives. These included reviewing the committee’s proposals and reducing import duties on payment devices like Point of Sale (POS) machines and QR code tools. The PM also stressed ensuring zero cost for merchants using the Raast QR system.

It was proposed that the government would bear 0.5% of the transaction value or Rs200 per transaction, whichever is lower. The estimated annual subsidy for this plan was around Rs2.5 billion. Later, in another session on July 14, 2025, the PM instructed that Rs3.5 billion be allocated in the current fiscal year to accelerate the adoption of Raast QR payments at retail outlets.

Following these instructions, the Ministry of Finance created a task on the Prime Minister’s Delivery Unit (PMDU) portal. The SBP, working with stakeholders, developed the MDR Subsidy Scheme. The scheme is designed to encourage a smooth shift from cash-based retail payments to a digital ecosystem that is more convenient, reliable, and cost-effective.

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Under this plan, the subsidy will go to banks, microfinance banks, and Electronic Money Institutions (EMIs) regulated by the SBP. They will receive 0.5% of the transaction value or Rs100 per transaction, whichever is lower. These entities may also charge up to 0.25% for onboarding and servicing merchants.

According to SBP’s assessment, the subsidy is enough to help digitise merchant transactions worth Rs700 billion annually. This would significantly promote digital payments at the retail level.

For the current financial year, Rs3.5 billion will be provided through a technical supplementary grant. Future allocations will be adjusted based on the yearly consumption. The SBP will also submit an evaluation report at the end of each financial year. This will track merchant adoption, consumer usage, and transaction volumes. Based on this review, the scheme can be expanded, modified, or discontinued.

The ECC approved the proposal under the title “Subsidy for Raast QR Code-Based Person-to-Merchant Payments.”