The State Bank of Pakistan (SBP) has extended its concessionary pricing mechanism for payment card transactions at petrol pumps until January 31, 2027, in a move aimed at encouraging digital payments and speeding up the rollout of the Raast QR payment system across the country.
The central bank announced on Tuesday that the Merchant Discount Rate (MDR) for card-present transactions at fuel stations will remain capped at Re1 per litre for purchases of fuel and related products. The Interchange Reimbursement Fee (IRF) has also been capped at Re0.20 per litre.
The decision applies to all payment cards issued in Pakistan and takes immediate effect. Earlier instructions issued on the matter will remain unchanged.
SBP said the extension is intended to make it easier for fuel stations to accept digital payments while supporting the wider adoption of the interoperable Raast QR payment system. It has directed banks, microfinance banks, electronic money institutions, payment service operators and payment service providers to work closely with fuel station operators to ensure Raast QR payments are available and fully activated.
The central bank added that it will review the pricing mechanism around January 31, 2027, after assessing market response and progress in digital payment adoption.
Petroleum dealers welcomed the move, saying it would lower transaction costs and encourage more customers to pay digitally. According to the industry, petrol pumps currently pay bank charges of about 0.8 percent on card transactions, which works out to nearly Rs2.40 per litre. Dealers say these costs had previously discouraged wider acceptance of card payments.
Pakistan Petroleum Dealers Association Chairman Malik Khuda Baksh said the decision would help increase the use of digital payments at fuel stations. While the association had sought the complete removal of bank charges, he said it appreciated the government’s step and hoped the fees would be reduced further in consultation with dealers.
Moreover, the government also reduced the price of petrol by Rs4.08 per litre to Rs331.95 on Monday, while high speed diesel was cut by Rs2.45 per litre to Rs389.93. The revised prices took effect on August 4 under the government’s petroleum pricing mechanism.
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