Karachi – Visa (NYSE: V), a global leader in digital payments, has released a whitepaper emphasizing the benefits of digitizing SME payments, identifying over $121 billion worth of SME B2B transactions in Pakistan primed for digital transformation.
Umar S. Khan, Country Manager for Pakistan & Afghanistan at Visa, highlighted the critical role of SMEs in the national economy, contributing 40% to the GDP and driving employment. However, he noted that many SMEs remain dependent on cash transactions, limiting their efficiency and scalability.
“As a cornerstone of Pakistan’s economy, SMEs contribute significantly to GDP and job creation. Despite their potential, they struggle with cash-based transactions, which impede their growth. Visa recognizes the transformative power of digital payments in addressing these challenges,” Khan stated.
The whitepaper explores how commercial cards can revolutionize B2B payments for SMEs by streamlining financial transactions and enhancing access to vital financial solutions. Visa advocates for collaboration among banks, fintechs, and government entities to raise awareness and improve digital payment infrastructure for SMEs.
Pakistan’s Payment Landscape and SME Challenges
According to the State Bank of Pakistan’s Payment Systems Quarterly Review for Q1 2025, there are 55.6 million payment cards in circulation, with debit cards making up 88% of the total. Despite growing digital adoption, 85% of the estimated $255 billion in Pakistan’s B2B payment flows in 2022 were still cash-based, highlighting significant inefficiencies.
Visa’s report indicates that only 15% of SME B2B payments in Pakistan are digital, and many SMEs remain unaware of commercial card benefits. Complex application processes, compliance hurdles, and limited access to credit further restrict their transition to digital payment solutions. Additionally, banks often classify SMEs as high-risk due to a lack of collateral and credit history.
Sector-Wise SME Payment Trends
Pakistan’s SME payables are dominated by the agriculture, retail, and manufacturing sectors. The IT sector also processes a substantial volume of B2B payments, particularly for international transactions. While consumer and small business card transactions remain high, a significant portion is limited to cash withdrawals rather than digital spending.
The Potential of Commercial Cards for SMEs
Visa’s report identifies a vast opportunity in the SME B2B payment sector, with $121 billion worth of transactions ready for digital integration. The largest 8% of SMEs account for 60% of total SME payables, making commercial cards a valuable tool for managing business expenses.
Commercial cards offer multiple advantages, including interest-free working capital, simplified cross-border trade, enhanced business credit-building opportunities, and data-driven financial insights. They provide SMEs with secure, efficient, and flexible payment options, real-time expense tracking, and spending controls.
Visa’s whitepaper recommends a comprehensive commercial card product suite with value-added services to drive efficiency, control, and convenience for SMEs. The transition from consumer to commercial cards presents a lucrative opportunity for issuers, enabling them to tap into new B2B payment streams and refine customer segmentation through usage data.
By fostering collaboration among financial institutions, fintechs, and regulators, Visa aims to accelerate SME digital transformation, paving the way for a more inclusive and efficient payment ecosystem in Pakistan.
