Electronic banking transactions post double-digit growth in Oct-Dec

KARACHI: Electronic banking transactions posted a double-digit growth in value during the second quarter of the current fiscal year of 2017/18 as development of digital payment platforms is attracting users towards cashless payments, the central bank said on Monday.

State Bank of Pakistan (SBP) said e-banking channels, including real-time online, mobile phone, internet and call centre banking, automated teller and point of sale (POS) machines and ecommerce sites processed 186.7 million transactions worth Rs11.7 trillion, up 8.67 percent in volume and 28 percent in value in the October-December period.

“Cashless/digital payments have seen a rise in the country due to the development of digital payment platform and introduction of PSO/PSPs (payment service providers) across various market segments,” SBP said in a quarterly payment systems review.

Transactions of Pakistan Real Time Interbank Settlement Mechanism (Prism), which is the second major source of digital payments in Pakistan, grew 19.1 percent in volume to 0.42 million and 6.3 percent in value to Rs93.6 trillion in the three-month period as compared to the corresponding period a year earlier.

“Prism is playing a key role in the financial infrastructure of the country,” SBP said. The mechanism has 41 direct participants comprising of 29 banks, two specialised banks, two microfinance banks, seven development finance institutions and Central Depository Company.

In October-December, real time online banking processed 41.7 million transactions worth Rs9.8 trillion, of which online cash deposits transactions had the highest share of 47 percent with value share of 19.6 percent. On the other hand, the share of real-time online intra-banks fund transfers was 32.3 percent in volume and 73.2 percent in value of transactions and online cash withdrawals contributed 21 percent and 7.2 percent share in volume and value of transaction, respectively.

The central bank said total number of ATMs installed by 32 banks in the country reached to 13,409 as of December-end 2017 from 12,963 a quarter earlier. ATMs processed 115.3 million transactions worth Rs1.35 trillion. Cash withdrawals contributed to the majority of the ATM transactions both in terms of volume 102.6 million (95 percent) and value Rs1.17 trillion (87 percent).

POS terminals of nine banks processed 16.4 million transactions amounting to Rs73.4 billion in October-December. Apart from merchant payments, three banks are also providing cash withdrawals through POS facility, while 25 banks are offering digital financial services through internet banking to 2.7 million users in the country as at end December 2017. Internet banking processed 7.4 million transactions worth Rs292.7 billion during the quarter under review.

Total 18 banks and microfinance banks offer mobile phone banking to 2.7 million users in the country. Mobile phone banking processed five million transactions amounting to Rs91.7 billion during the quarter under review.

“Due to the rapid increase of internet and mobile phone banking in the country, the overall volume of call centers banking has reduced,” SBP said. Call centres banking processed 77,000 transactions worth Rs2.4 million in the October-December period.

The central bank further said the number of local ecommerce merchants registered with banks reached to 905 in October-December from 812 in the previous quarter, showing a quarterly growth of approximately 10 percent. Consumers carried out 1.4 million ecommerce transactions worth Rs9.1 billion through the registered ecommerce merchants during the quarter. The transactions depicted a quarterly growth of 11 percent in volume and 15 percent in value of transactions, respectively.

As on December 31, 2017, the number of total payment cards issued in Pakistan reached to 39.3 million from 37.8 million in the previous quarter, showing a quarterly growth of 4.1 percent.

SBP said during the quarter under review, 117.6 million transactions of worth Rs40.3 trillion were carried out using paper-based instruments, including over the counter cash deposits, cheques, pay orders and demand drafts. The transactions showed a quarterly decline of one percent in volume of transactions, however showed an increase of 7.9 percent in value of transactions comparing with the previous quarter. “The average value of paper-based transaction has increased comparing to previous quarter, which shows that for small transactions people prefer e-banking channels,” the central bank added.