This Eidul Azha saw a significant change towards digital payments in Pakistan’s cattle markets, with transactions totaling Rs360 million processed through Quick Response (QR) code payments.
In an email answer, the State Bank of Pakistan said that it had started an initiative to digitize payments in cattle markets and that it had introduced QR codes as a simple payment option. Using the Raast fast payment system, 18 banks participated in the experiment, encompassing 48 cattle markets nationally.
Four thousand sixty-seven merchants were added to the system to take payments using international bank account numbers (IBANs) and QR codes. More than 12,356 transactions totaling Rs360 million were carried out using these techniques.
The SBP relaxed transaction and balance limits to facilitate the opening and usage of accounts for cattle sellers. The initiative received positive feedback from users and sellers, who appreciated the convenience of digital payments.
The SBP emphasized that this method provided a secure way to handle large payments. It relieved customers of carrying large sums to cattle markets and spared sellers from managing cash risks.
This effort also brought many cattle sellers into the formal banking system, previously excluded. Banks benefitted by expanding their connections in the livestock sector and digitizing payment channels.
During Eidul Azha, Pakistani households spend significant sums on sacrificial animals, contributing billions to the economy. Yet, this sector’s economic impact remains minimal due to informal supply chains.
The Pakistan Tanners Association reported that over Eid’s three days, more than 6.8 million animals were sacrificed nationwide, valued at over Rs500 billion.
While the SBP aims to reduce currency circulation, June data showed a 7.4% increase in currency circulation, suggesting cash still dominated Eid spending.
One bank installed cash deposit machines (CDMs) in Karachi and Faisalabad cattle markets, handling 655 transactions totaling Rs200 million.
JazzCash, a leading fintech platform serving over 44 million customers, managed many QR transactions across 45 cattle markets in 16 cities during Eid. They facilitated over 5,000 transactions worth around Rs85 million, emphasizing the benefits of digital payments to buyers and sellers.
President of JazzCash, Murtaza Ali, highlighted the potential for greater financial inclusion and a documented economy through these innovations.
He mentioned JazzCash’s 82% revenue growth in 2023, driven by a transaction value of Rs5.8 trillion.
SBP’s review for October-December 2024 forecasts further growth in person-to-merchant (P2M) QR payments, enhancing digital payment shares in retail transactions.
SBP introduced Raast P2M services to enable businesses to accept QR codes, Raast Alias, IBAN, and requests to pay. Raast handled over 107 million transactions worth Rs2 trillion in FY24’s second quarter, surpassing Rs7 trillion since January 2021.
Easypaisa, another digital payments platform, facilitated QR transactions at 200+ merchants in major cities during Eid, aiming to enhance financial services accessibility for farmers and merchants in rural and semi-urban areas.
They noted challenges like awareness gaps and concerns among traders and buyers about QR payment reliability, especially with non-smartphones.
Zindigi, powered by JS Bank, highlighted empowerment for farmers and merchants in financial transactions, aligning with Pakistan’s digital inclusivity goals.
These initiatives mark a significant step towards a more inclusive, agile, and transparent digital payment ecosystem in Pakistan.
