E-banking transactions increase 31% year-on-year during Jan-Mar: SBP

Digital financial transactions continued to march upwards in Pakistan, with mobile and internet banking users showing considerable increase during the third quarter of the outgoing fiscal year, stated the State Bank of Pakistan's (SBP) Quarterly Payment System Review released on Monday.

During the three-month period between January and March 2021, bank customers performed 309.5 million e-Banking transactions, valuing Rs22.5 trillion and registering growth rates of 31 percent by volume and 29 percent by value over the same quarter last year, according to the report.

"Most of the uptake in e-banking transactions was seen in internet banking and mobile banking transactions," stated the SBP.

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The volume of mobile banking transactions reached 51.7 million, (up 144 percent) valuing Rs1.3 trillion (up 178 percent) compared to 21.2 million transactions valuing 467.5 billion in the same quarter last year. The number of registered mobile phone banking users reached 9.8 million showing an increase of 20% from the same period last year.

Similarly, 24.5 million internet banking transactions valuing Rs1.5 trillion were recorded during this period compared to Rs0.75 trillion in the same quarter last year, registering a growth of 74% by volume and 109% by value.

On a quarterly basis, the report found that overall, the country’s total payment transactions increased by 2% in volume and 10% in value i.e. 402.5 million and Rs 153.6 trillion respectively. The transaction value for PRISM increased from Rs94.9 trillion in the previous quarter to Rs 109.3 trillion in the current quarter showing a growth of 15%.

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The overall use of e-Banking channels has seen an increase of 4% in volume and 5% in value over the previous quarter. The number of paper-based transactions have decreased from the previous quarters, which as per the central bank can be inferred from increase in usage of digital channels by general consumers.

The report found that the number of internet and mobile banking users have also shown considerable rise during the last few quarters.

During the third quarter the internet banking users stood at 4.97 million showing an increase by 10% when compared with the previous quarter, and an increase of 30% when compared with the same quarter last year. Similarly, mobile banking users have increased by 5% quarter on quarter growing to 9.85 million, while showing an increase of 20% when compared with the same period last year.

E-commerce merchants are also on an inclining trend in the last few quarters. When compared with the previous quarter, e-commerce merchants have increased by 5% to 2,523 users, however, comparing with the same period last year, a staggering growth of 62% has been observed.

“The numbers can clearly lead us to be believe the consumers are realizing the benefits that digital payment channels have in our daily lives. This complements the increase in the trust of the consumers in usage of digital channels.

“This could have not been possible without the continuous efforts by SBP to digitize the economy which has the potential to change overall payments landscape of the country for the better,” said the report.

Coming to the deployment of payment infrastructure, the commercial banks has deployed 16,175 ATMs in the country, an increase of 134 ATMs during the quarter. Meanwhile, the banking industry has deployed more than 4,000 POS (Point of Sale) machines, reaching to an all-time high number of 67,099.

Bank branches

With regards to physical presence, the report said that there are 16,223 bank branches reported by Banks/MFBs, out of which 107 are overseas branches.

"All branches, except 35, are providing online banking services to their customers.

"We have observed a decline in the number of branches, showing that the industry is slowly realizing the benefits of digital payment infrastructure that the digital channels bring to the overall consumer experience and its impact on the bottom line."