- Draft bill now to be presented before provincial cabinet for formal endorsement to position province as the country’s pioneer in developing a comprehensive legal framework for a digital economy
- All government, business, and service-sector payments to transition to QR code–based system
- Move aimed at curbing corruption, improving revenue stability, and enhancing governance
PESHAWAR: Khyber-Pakhtunkhwa Chief Minister Sohail Afridi on Saturday approved the landmark Khyber-Pakhtunkhwa Digital Payments Act 2025, a first-of-its-kind initiative in Pakistan aimed at establishing a modern, transparent, and technology-driven economic system across the province.
The draft bill will be presented before the provincial cabinet for formal endorsement, positioning KP as the country’s pioneer in developing a comprehensive legal framework for a digital economy.
Under the new law, all payment systems across government departments, businesses, and the service sector will be required to transition to QR code–based digital payments, streamlining financial transactions, enhancing transparency, and ensuring greater convenience for the public.
In a significant relief for the previously undocumented sector, CM Afridi announced that for two years from the Act’s commencement, any digital payments received by newly registered business entities will not be used as a basis for imposing new direct sales tax liabilities. This measure is designed to encourage small and informal businesses to enter the formal economy without fear of immediate taxation. However, refusal to accept digital payments or charging extra fees will be treated as a violation of the legislation.
The chief minister highlighted the broader objectives of the bill, noting that it will accelerate financial inclusion, reduce dependence on cash transactions, and support KP’s transition to a modernised provincial economy. Safeguards have been built into the system to protect both consumer and business data, ensuring compliance with international security and privacy standards.
To ensure smooth implementation, the provincial government plans to introduce public Wi-Fi and other digital services in markets and commercial zones. Financial and digital literacy will also be integrated into the academic curriculum, while district-level structures will oversee training programmes to onboard businesses effectively.
CM Afridi emphasised that the initiative sets KP on the path to becoming Pakistan’s first cashless model economy, offering a potential roadmap for both federal and provincial governments. He said a modern digital payment system is essential in today’s era, easing financial transactions for citizens and businesses alike.
He added that widespread adoption of digital payments will curb corruption, improve revenue stability, enable data-driven policymaking, and enhance government performance, while reinforcing public trust in governance—marking a major milestone in KP’s digital transformation journey.
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