1LINK has proposed making PayPak cards mandatory for government employees’ salary accounts, subsidy programmes and selected public-sector payments as Pakistan seeks to increase the use of domestic payment infrastructure. The recommendations, shared by the State Bank of Pakistan (SBP), are part of a broader effort to reduce reliance on international card networks such as Visa and Mastercard and increase transactions processed through Pakistan’s own payment rails. Under the proposal, PayPak cards could be issued to government employees, beneficiaries of subsidy programmes and social safety-net initiatives, as well as users of selected mass-transit payment systems. The proposal places the domestic card scheme at the centre of efforts to expand digital payments across government-related transactions.
The recommendations also include measures aimed at increasing PayPak usage among consumers and merchants. 1LINK has proposed tax relief and incentives for Point-of-Sale (PoS) and e-commerce transactions conducted through PayPak cards. It has further recommended that public-facing government service centres, including NADRA, Excise and Passport offices, install PoS terminals capable of accepting PayPak payments. Additional incentives under the proposal include discounts, cashback offers and loyalty rewards for PayPak transactions, particularly for utility bill payments, fuel purchases, public transport fares and other government-related payments. These measures are intended to encourage both consumers and merchants to use the domestic payment network for everyday transactions.
The proposal forms part of a wider SBP strategy focused on increasing the use of domestic payment infrastructure, including PayPak and Raast. PayPak is Pakistan’s domestic payment card scheme, while Raast serves as the country’s instant payment system and supports digital transactions through different channels. The central bank has already introduced several measures to develop the PayPak ecosystem, including co-badged PayPak cards that can be used for both domestic and international transactions, expanded acceptance for e-commerce payments, promotional incentives and awareness campaigns. These developments have contributed to improvements in PayPak functionality, merchant acceptance and transaction volumes, while the expansion of Raast Person-to-Merchant (P2M) payments has also accelerated the adoption of digital payment methods.
The SBP also highlighted the progress of Raast P2M transactions following government support for QR-based digital payments. The government allocated Rs3.5 billion for a Raast QR-code subsidy programme during FY2025-26, which contributed to a significant increase in daily P2M transactions. Daily transactions reportedly increased from around 60,000 in June 2025 to nearly 1.1 million by June 2026. The central bank said merchant onboarding and QR-based digital payments would continue to be promoted as part of efforts to expand Pakistan’s digital payments ecosystem. The developments around Raast and PayPak indicate a broader push toward increasing the use of domestic payment channels across retail, government and merchant transactions.
If implemented, the proposed PayPak requirements could significantly increase the reach of Pakistan’s domestic payment infrastructure by connecting government salaries, subsidies and public-sector payments with a local card scheme. The proposal is still a recommendation rather than an implemented mandatory requirement, meaning further policy decisions would be required before government employees and beneficiaries are required to use PayPak cards. The proposed combination of mandatory issuance, merchant acceptance, tax incentives and consumer rewards reflects an attempt to increase adoption from both sides of the payment ecosystem. For Pakistan’s digital payments sector, the initiative could further expand PayPak usage while supporting the wider policy objective of increasing transactions through domestic payment networks such as PayPak and Raast.
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