Govt Approves Rs. 3.5 Billion Subsidy to Boost Raast QR Payments

In a significant move to accelerate Pakistan’s transition toward a cashless economy, the federal government has approved a Rs. 3.5 billion subsidy aimed at boosting merchant onboarding on the Raast platform and encouraging digital payments through QR codes. The State Bank of Pakistan (SBP) announced that this incentive will support Person-to-Merchant transactions conducted between September 1, 2025, and June 30, 2026. Under the scheme, financial institutions will receive support at a rate of 0.5 percent of each transaction’s value or Rs 100, whichever is lower. The initiative falls under the Prime Minister’s Cashless Economy program and is designed to promote the adoption of digital payments by making it easier and more attractive for merchants to accept payments via Raast QR codes. According to the SBP, the subsidy will be shared equally between the merchant’s financial institution and the customer’s financial institution, covering both acquiring and issuing banks. In addition to the subsidy, regulated entities may charge up to 0.25 percent of the transaction value for onboarding and servicing merchants. The payments will be made to regulated entities on a quarterly basis, and if the total subsidy amount exceeds the annual ceiling of Rs. 3.5 billion, the rate will be adjusted downward to ensure equitable distribution within the allocated budget. The SBP has instructed all regulated entities, including banks, microfinance banks, electronic money institutions, payment system operators, payment service providers, merchant service providers, and customer service providers, to comply with the prescribed process and maintain comprehensive records for verification and audit purposes. Only successful transactions posted in the Raast system will be eligible for the subsidy. Regulated entities are required to submit quarterly subsidy claims, verified by their internal audit departments, to Raast Payments Pakistan within five working days of the quarter’s close. Raast Payments Pakistan will then verify these claims against its own data, and any discrepancies will be communicated to the relevant financial institution within five working days. Institutions must reconcile any differences and submit final claims within another five working days. If no response is received within the stipulated time, the calculated subsidy amount will be considered accepted. The SBP’s inspection teams may verify claims during their regular on-site inspections. The subsidy claim for September 2025 will be paid along with claims for the quarter ending December 31, 2025. All subsidy payments will be released after the Finance Division sanctions and releases the necessary funds.