Pakistan’s War on Cash: When “Modernisation” Means Penalising the Poor

By Frane Maroevic, Director General, International Currency Association

It appears that Pakistan’s “war on cash” is set to affect those who can least afford it. The 2025-26 federal budget is introducing a dual pricing system: if you pay with cash for petrol, groceries, or anything else, you will be charged more.

The stated aim of this policy is to shrink the black market and broaden the tax net. However, it is worth remembering that most people who rely on cash were not named in the Panama Papers or offshore leaks, hiding millions in secret accounts.

They are simply trying to get by. If governments are serious about tackling tax avoidance, the focus should be on large-scale schemes, not on the poorest in society.

The reality is that the poorest—an estimated 60% of the population without a bank account—are also those with low digital literacy, often living in rural areas with patchy or non-existent internet access.

It is clear who will pay more under this system. It will not be the urban elite, but the daily wage labourer who has never owned a smartphone, or the widow in a village without internet.

While “low-cost” digital payments and QR codes are often promoted as alternatives, they depend on access to smartphones, stable internet, and a level of digital confidence that millions simply do not possess.

There is also the issue of reliability. Digital systems can and do fail, particularly during power outages or technical problems, which can leave money inaccessible in cyberspace. Cash, by contrast, never needs recharging and never goes offline. It remains the most resilient payment system available.

Many countries are now recognising that moving towards a cashless society can pose a national security risk. Legislation is being introduced to guarantee the right to pay in cash, ensuring a resilient and sovereign payment system in the event of disasters or conflicts.

The dual pricing policy may, on the surface, appear to be a tool for reform. In reality, it is a surcharge on the poor and a questionable step in terms of national security.

A fair economy does not punish people for the way they pay, especially when the so-called “choice” is not really a choice at all.

Cash remains the only form of money that is truly owned by the people.