Despite encouraging initiatives like the State Bank’s Raast platform and the rapid spread of mobile banking apps, the shift towards a digital economy faces serious roadblocks. Weak internet infrastructure and low financial literacy continue to limit the impact of these reforms. For many traders and consumers, especially in smaller cities and rural areas, cash remains not only the default mode of transaction but also the most practical one. The government’s target of expanding digital merchants to two million and doubling digital transactions to 15 billion by 2026 may look impressive on paper, but the reality is less optimistic.
When 70% of daily transactions still occur in cash and millions of Pakistanis remain outside the banking system, digital transformation becomes less about innovation and more about inclusion. The state must first invest in stable connectivity and simplify digital tools before pushing ambitious numerical goals. Moreover, as tax experts note, there are few incentives for traders to embrace digital payments. The perception that digitisation increases tax exposure without tangible benefits has discouraged participation. The government must therefore introduce clear incentives to encourage adoption.
Going digital will indeed benefit Pakistan in the long run. It can help formalise the economy and expand the tax base – all essential for sustainable growth. But for now, the success of a cashless Pakistan depends on whether policymakers can bridge the gap between policy ambitions and on-ground realities. Until then, cash will continue to be king.