Go Cashless: cattle markets settle Rs4.66bn via 64,553 online transactions on Eid-ul-Adha 2025
The number of transactions in terms of volume and value both spiked compared to Eid-ul-Adha 2024 when buyers and sellers made a total of 13,000 digital transactions valued at Rs560 million, a figure that the central bank gave in a statement earlier this year.
SBP launches nationwide 'Go Cashless' campaign for Eid-ul-Adha
According to the SBP statement on Wednesday, the rise in transactions was the result of the central bank's campaign titled 'Go Cashless' for the cattle markets in 2025.
'With the participation of 24 partner banks, the campaign was successfully implemented in 54 major cattle markets across Pakistan.'
To support the Go Cashless campaign, the SBP had temporarily eliminated daily transaction limits and the per-month limit had been increased to Rs5,000,000 for Branchless Banking Level-1 Accounts, Asaan Account/Asaan Digital Account, and Merchant Accounts for the period (May 19 to June 15, 2025).
Launched before Eid-ul-Adha (May 20 to June 6), the Go Cashless campaign aimed to promote Digital Financial Services (DFS) and reduce reliance on cash transactions in urban cattle markets.
'This campaign was highly appreciated by the buyers and sellers in the cattle markets, as it reduced their reliance on cash,' the central bank said.
Eid-ul-Adha 2025: NBP installs ATM booth at Karachi cattle market
SBP, Banking Services Corporation (SBP BSC), hosted an award ceremony on Wednesday in Karachi to honour high-performing banks for their contributions to the Go Cashless in Cattle Markets Campaign 2025. In recognition of the regional impact of campaign, SBP field offices also organised recognition ceremonies for participating banks in their respective regions.
Digital payment systems play a vital role in modern economies by offering transparency, reducing fraud risks, and providing secure, convenient, and inclusive access to financial services.
'Initiatives like Go Cashless are crucial in building trust and driving the adoption of digital platforms among a wide range of users, including livestock buyers and sellers,' the central bank said.
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Business Recorder
5 hours ago
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Go Cashless: cattle markets settle Rs4.66bn via 64,553 online transactions on Eid-ul-Adha 2025
KARACHI: The State Bank of Pakistan (SBP) reported on Wednesday that cattle markets had made 64,553 online payments worth Rs4.656 billion to settle transactions for sacrificial animals among buyers and sellers on Eid-ul-Adha that fell in the first week of June this year. The number of transactions in terms of volume and value both spiked compared to Eid-ul-Adha 2024 when buyers and sellers made a total of 13,000 digital transactions valued at Rs560 million, a figure that the central bank gave in a statement earlier this year. SBP launches nationwide 'Go Cashless' campaign for Eid-ul-Adha According to the SBP statement on Wednesday, the rise in transactions was the result of the central bank's campaign titled 'Go Cashless' for the cattle markets in 2025. 'With the participation of 24 partner banks, the campaign was successfully implemented in 54 major cattle markets across Pakistan.' To support the Go Cashless campaign, the SBP had temporarily eliminated daily transaction limits and the per-month limit had been increased to Rs5,000,000 for Branchless Banking Level-1 Accounts, Asaan Account/Asaan Digital Account, and Merchant Accounts for the period (May 19 to June 15, 2025). Launched before Eid-ul-Adha (May 20 to June 6), the Go Cashless campaign aimed to promote Digital Financial Services (DFS) and reduce reliance on cash transactions in urban cattle markets. 'This campaign was highly appreciated by the buyers and sellers in the cattle markets, as it reduced their reliance on cash,' the central bank said. Eid-ul-Adha 2025: NBP installs ATM booth at Karachi cattle market SBP, Banking Services Corporation (SBP BSC), hosted an award ceremony on Wednesday in Karachi to honour high-performing banks for their contributions to the Go Cashless in Cattle Markets Campaign 2025. In recognition of the regional impact of campaign, SBP field offices also organised recognition ceremonies for participating banks in their respective regions. Digital payment systems play a vital role in modern economies by offering transparency, reducing fraud risks, and providing secure, convenient, and inclusive access to financial services. 'Initiatives like Go Cashless are crucial in building trust and driving the adoption of digital platforms among a wide range of users, including livestock buyers and sellers,' the central bank said.
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The decline in ADR highlights banks' reluctance to lend aggressively, due to concerns about borrower creditworthiness, regulatory constraints or a lack of demand from the private sector. photo: file Listen to article At first glance, Pakistan's economy appears to be on the path to recovery, macro indicators are stabilising, and optimism is cautiously returning. But a closer look reveals that many of the country's deep-rooted structural problems remain unresolved. One such issue is the Investment-to-Deposit Ratio (IDR), which has now reached an all-time high of 103%, even exceeding total deposits. This means that banks are channelling the bulk of their deposits into government securities, effectively crowding out the private sector, the true engine of sustainable economic growth. While this trend may bolster short-term bank profitability and fiscal financing, it raises serious concerns about the long-term health of the real economy, which depends on private sector credit to drive investment, innovation, and job creation. Pakistan is bound by restrictions imposed by the International Monetary Fund (IMF), which prohibits the government from directly borrowing from the State Bank of Pakistan (SBP) through money printing. This measure is aimed at curbing unchecked monetary expansion, which fuels inflation and undermines economic stability. In response, the government machinery, including the State Bank of Pakistan (SBP), has resorted to injecting massive liquidity into private banks through Open Market Operations (OMOs), recently reaching an unprecedented Rs14 trillion. This level of intervention is extraordinary, especially when compared to peer economies. The injected funds are then funnelled into government securities, creating a self-serving loop: banks earn risk-free profits by lending to the government, while the government avoids borrowing directly from the SBP. This cycle not only enriches a few without exposing them to market risks but also starves the real economy of credit, depriving millions of people and businesses of the economic opportunities they desperately need. "As of June 2025, the Investment-to-Deposit Ratio (IDR) reached 103%, up 608bps YoY, indicating that banks have invested more than their total deposits — highlighting a tilt towards government papers rather than private sector lending," noted Deputy Head of Trading at Arif Habib Ltd, Ali Najib. This means that banks have now invested more than their total deposits, a clear indication that they are increasingly favouring risk-free government securities over lending to the private sector. The trend underscores a cautious stance amid ongoing economic uncertainty. During the same period, total deposits rose by 14.1% year-on-year to Rs35.5 trillion, while bank investments surged by 21.2% to Rs36.6 trillion. In contrast, advances increased by only 8.7%, reaching Rs13.5 trillion, indicating a slower pace of credit expansion. This divergence in growth has led to a decline in the Advance-to-Deposit Ratio (ADR) to 38.1%, down from 40.0% a year earlier and 39.8% in May 2025. The decline in ADR highlights banks' reluctance to lend aggressively, partly due to concerns about borrower creditworthiness, regulatory constraints, or a lack of demand from the private sector — but mainly due to the fact that when there is a safe avenue, why would anybody take the risk? Looking ahead, the banking sector is expected to remain stable, according to AHL, supported by rising deposit inflows and strong earnings from government-backed investments. However, the continued preference for investment over lending could constrain private sector growth and job creation, unless broader macroeconomic stability and investor confidence are restored. Experts suggest that the central bank and policymakers may need to revisit regulatory and fiscal measures to encourage more balanced credit allocation across the economy.
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Moody's questions missed tax target
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But it is still below the investment grade and hampers Pakistan's smooth entry in the international capital markets to raise debt. According to the officials, Moody's asked about the impact of missing the tax-to-GDP ratio in the last fiscal year on this fiscal year's targets. Aurangzeb said that the Federal Board of Revenue (FBR) would give a separate briefing to the rating agency for addressing any of its concerns, according to the officials. The FBR's tax-to-GDP ratio remained at a little over 10.2% as against the target of 10.6% after the FBR could pool only Rs11.745 trillion in taxes in the fiscal year 2024-25. The government missed the annual tax collection target by a margin of Rs1.225 trillion. After the meeting that Moody's team was provided with a comprehensive overview of Pakistan's reform journey, with a particular emphasis on improving the tax-to-GDP ratio through technology-driven tax administration reforms, digitisation of systems, and robust enforcement measures. The minister emphasised that under the direct oversight of the prime minister — who chairs regular meetings on tax reform — the government was implementing measures to expand the tax base, plug leakages, and enhance compliance. Aurangzeb noted that the Rs2 trillion revenue delta achieved this year had come through autonomous efforts, and the government was firmly committed to reaching a tax-to-GDP target of 13 to 13.5% in the next few years, according to the ministry. Moody's also asked about the details of the Pakistan-US trade talks but the government did not share any details except that the deal was expected soon. The sources said that the United States has asked for preferential trade treatment to which Pakistan has proposed to sign a pact. "Ongoing discussions with the United States on preferential tariff access were noted as making encouraging headway," the Ministry of Finance stated after the meeting. There were also questions about the average interest rate that the government used for allocating the Rs8.3 trillion for debt servicing for this fiscal year. Moody's was informed that a 12% average interest rate had been used for this fiscal year. Moody's asked about the movement in the exchange rate and any restrictions on imports. The central bank clarified that the exchange rate was market determined and there were no restrictions on imports. The rupee has again started coming under pressure and the grey market is resurfacing with a rate that is about Rs7 per dollar higher than the inter-bank rate, according to the exchange market dealers. According to the finance ministry, the Finance Division provided an in-depth briefing on Pakistan's macroeconomic outlook, reform agenda, and financial stability. "Looking ahead, the finance minister expressed optimism that the improving macroeconomic indicators and reform momentum would be positively acknowledged by rating agencies, further strengthening Pakistan's case to tap international markets and deepen its external sector stability," said the ministry. Aurangzeb and his team presented compelling evidence of macroeconomic recovery, including a sharp reduction in inflation, a cut in the policy rate, stabilisation of the exchange rate, a current account surplus, and a surge in foreign exchange reserves — crossing $14 billion by the end of June, stated the ministry. It added that the improvements in remittance inflows and export performance were also cited as signs of resilience and renewed investor confidence. During the session, the finance minister apprised the Moody's team of the significant strides Pakistan has made in stabilising its economy and laying the foundations for sustainable and inclusive growth, it added. He underlined the successful completion of the final International Monetary Fund (IMF) review under the Stand-By Arrangement, including the disbursement of the second tranche and progress under the Resilience and Sustainability Facility (RSF), as key milestones that have restored confidence in Pakistan's economic management. The minister highlighted a series of structural reforms undertaken by the government to anchor long-term stability. These included prudent fiscal measures in the recently announced budget, tariff and trade liberalisation geared towards export-led growth, and concerted efforts to rationalise expenditure. The meeting further outlined Pakistan's re-engagement with global financial markets, including the successful arrangement of $1 billion in commercial financing from the Middle Eastern region, plans for an inaugural Panda bond, and Pakistan's intent to explore the Eurobond and other international debt markets as credit ratings improve. The finance minister also addressed queries from the Moody's team and reiterated Pakistan's commitment to staying the course on macroeconomic reforms, including in areas of privatisation, restructuring of state-owned enterprises (SOEs), and right-sizing of government.
