The KP government plans to convert all person-to-government payments to digital mode from September 1. Officials say the move could raise provincial revenue by nearly 70 per cent and add about Rs29 billion annually.
The Khyber Pakhtunkhwa government has decided to shift all person-to-government payments to digital mode from September 1, in what officials describe as a province-wide governance reform that would make KP the first province in Pakistan to fully adopt a cashless system for such receipts.
A senior official leading the reform programme said the move was part of the government’s good governance agenda and was close to full implementation by the target date. He said the transition to digital payments was expected to increase revenue by nearly 70 per cent, adding that the initiative could generate an additional Rs29 billion or more each year.
According to the official, the province has already digitised 148 services and aims to complete the digital conversion of all 172 services by September 1. He said the change would remove direct human interaction in payments, simplify the process for citizens and allow money to be paid directly into the provincial treasury. He also said changes were being introduced through the Finance Act, 2026, to provide legal cover for some of the measures being taken.
Dr Akif Khan, managing director of the KP Information Technology Board, said the cashless payments drive was being implemented through direct integration with existing online payment systems and online payment options through a dedicated Mahasil revenue app. He said the system would operate with the support of an integrated payment gateway.
Revenue projections and rollout plan
Documents seen by Dawn showed the initiative began in March 2025 and was followed by data collection that led to the finalisation of a cashless strategy. The documents said person-to-government revenue of the KP government currently stands at Rs42 billion annually and is projected to rise by Rs29.4 billion after a full shift to cashless payments.
The documents stated that all such payments are currently made manually, with every rupee passing through a physical counter, leaving no digital audit trail and creating exposure to leakage. Referring to the KP Revenue Authority’s experience with digitalisation, the documents said revenue growth there had become visible, measurable and auditable after the transition.
“Since KP Revenue Authority (KPRA) went fully digital, year-on-year revenue growth is clearly visible, measurable and auditable. Leakage has been eliminated as every rupee was tracked from point of collection,” the document stated.
The same model used by KPRA is to be extended to all account-1 payments, under which the public deposits money directly into the government treasury. The documents added that after the digitisation of fines imposed by assistant commissioners, collections under that head rose by 69 per cent. In 2023, 223,732 manually collected fines generated Rs223.7 million, while digital collection of 182,972 fines in 2025 brought in Rs378 million, an increase of Rs154.3 million.
The documents also cited arms licence revenue. Before digitisation, that head generated Rs1.45 billion in 2022. After the introduction of digital payments, the amount rose to Rs1.59 billion, and in 2025, following full digitisation of arms licences, revenue reached Rs2.50 billion, showing growth of Rs1.05 billion.
“Arms licence digitisation delivered 72.7 per cent revenue growth from 2022-25, reducing leakage, stronger compliance and an unambiguous digital audit trail across all transactions,” it said.
According to the revenue projections in the documents, if the government does not go digital, account-1 public deposits would remain at the present Rs42 billion. The projections say 5 per cent digital transactions would add Rs2.1 billion, 50 per cent digital payments would increase revenue by Rs21 billion, while more than 70 per cent digitisation would raise collections by Rs29.4 billion.
Under the account-1 digitisation plan, 170 services across 34 government departments will be handled through cashless payments and QR code deployment using the Raast and 1-Go platforms. Out of 172 person-to-government payment account heads under account-1, digital tags have been issued for 170, while 148 are digitally enabled and 22 are under process at KPITB.
The documents further said that around 300 non-account-1 services are also being processed. In that category, 698 services have been identified in autonomous bodies, corporations and local government entities. Agreements have been signed for 637 of them, 218 have been physically submitted to KPITB, and 480 are still pending. To reduce pressure on KPITB, 122 entities will sign agreements with commercial banks.
Reference Link:- https://www.pakistantoday.com.pk/2026/06/23/kp-to-make-all-govt-payments-cashless-from-september-1