The transition to a cashless economy is rapidly becoming a global phenomenon, with digital transactions replacing cash in many parts of the world. The shift has been catalyzed by technological innovation and accelerated further by the Covid-19 pandemic, which highlighted the convenience and safety of contactless payments. Pakistan, too, is taking steps in this direction, with the finance minister rightly emphasizing that the move toward a digital payment ecosystem is not just a policy ambition but a practical necessity for long-term economic resilience, competitiveness, and inclusive growth.
The upcoming federal budget is expected to include concrete steps to promote financial digitization. These include incentives for digital transactions, disincentives for cash dealings, and targeted restrictions on cash payments in select sectors. With the real-time digital payment system Raast already operational and seeing growing adoption across individuals, businesses, and government entities, the infrastructure needed to support a cashless economy is gradually falling into place.
This digital momentum is visible even at the grassroots level, with small vendors in urban areas increasingly accepting payments via QR codes, mobile wallets, and other digital tools. The benefits are obvious: transparency, efficiency, lower risk of theft or fraud, improved tax documentation, and broader financial inclusion. A cashless system can also help shift the tax burden away from the already-stretched salaried class to sectors that traditionally evade taxation.
However, the journey toward a cashless society is far from straightforward. Major structural challenges still hamper the full realization of this vision. A significant proportion of the population remains unbanked, particularly in rural areas and among women. Poor mobile and internet connectivity in large parts of the country limits access to digital services. Additionally, concerns around cybersecurity and the fear of government surveillance deter some people from adopting digital payments.
Cultural habits also play a role. For many, cash remains synonymous with financial control and privacy. Overcoming this resistance will require more than just financial incentives or penalties—it will demand sustained public awareness campaigns, digital literacy programs, and a robust regulatory framework to protect user data and ensure trust in digital platforms.
The government’s push for financial digitization is timely and necessary. But to make it successful, the transition must be inclusive, secure, and supported by infrastructure investments and regulatory safeguards. Without addressing the deep-rooted socioeconomic and technological barriers, the dream of a cashless economy will remain just that—a dream. A thoughtful, phased, and people-centric approach is essential to ensure that no one is left behind in the digital financial revolution.
