Digital payments target merchant growth

"The digital payments ecosystem is entering a phase where the focus needs to shift from access to adoption," said Muhammad Hamayun Sajjad, CEO Mashreq Pakistan, the country's first newly launched digital bank to offer the full suite of Raast services.

It has just introduced Raast Person-to-Merchant (P2M) payments, allowing merchants to receive instant payments through QR codes and customers to pay through digital banking channels. Raast processed approximately 742 million transactions worth Rs23.27 trillion during the quarter.

Person-to-person (P2P) payments accounted for 664 million transactions valuing at Rs18.88 trillion compared with 603 million transactions worth Rs15.69 trillion in the preceding quarter. Total Raast transactions increased from 295.7 million in the second quarter of fiscal year 2024-25 to 371.2 million in the third quarter and 412.1 million in the fourth quarter.

The volume rose to 543.9 million in the first quarter of FY2025-26, 645.7 million in the second quarter and 742 million in the third quarter.

By March 2026, Pakistan had 95.8 million branchless banking mobile app users, 28.9 million banking mobile app users and 7.3 million electronic money institution wallet app users, highlighting the expanding base of consumers with access to digital financial services.

Raast Payments Pakistan CEO Ahson Bin Saeed said the next phase of the national payment infrastructure would involve strengthening the system, broadening participation and ensuring that institutions could build reliable and accessible payment experiences on top of it.

He said the launch of Raast P2M was another step towards translating the national payment infrastructure into everyday use for merchants and consumers. However, industry stakeholders have pointed to commercial and behavioural challenges that could affect the pace of adoption.

"The adoption of Raast in Pakistan is progressing at a relatively fast pace; however, a significant part of this momentum appears to be driven by regulatory encouragement and the strong push from the regulator, rather than entirely by organic market demand," said i. Path CEO Abdus Samad Khan.

He said the absence of a direct consumer-fee model created commercial challenges for banks, fintechs and payment service providers. Unlike the previous inter-bank funds transfer model, Raast P2P and P2M payments are required to remain free for consumers.

While this benefits users, service providers must recover the costs of technology, infrastructure, compliance, customer support and transaction processing through other revenue streams. Khan also identified limited consumer awareness and merchant behaviour as challenges. Many consumers remain unfamiliar with how Raast works, where it can be used and how it differs from other digital payment channels.

In some cases, merchants reportedly encourage customers to pay in cash or use established wallets such as easypaisa and Jazz. Cash instead of formal Raast merchant payment channels, limiting the growth and visibility of the P2M ecosystem.

Merchant payments are emerging as the next major frontier for digital payments., more than 2.6 million merchants had been onboarded or registered their aliases for Raast P2M by the end of March 2026. The challenge, however, is to convert merchant registration into regular usage.

Smaller businesses face issues related to onboarding, reconciliation, settlement, digital literacy and perceptions regarding taxation and transaction records. State Bank's Director of Digital Innovation & Settlements Department Muhammad Imad Uddin said the central bank remained focused on developing the regulatory and technological foundations for a more connected and inclusive payments landscape.

The real measure of progress, he added, was how effectively the infrastructure was adopted across the ecosystem. The government allocated Rs3.5 billion to support Raast P2M QR transactions between September 2025 and June 2026.