New Delhi, Sep 26 (IANS): Pakistan’s efforts to tackle poverty and economic vulnerability are being constrained by low levels of financial inclusion, with nearly two-thirds of the adult population remaining outside the formal financial system despite growing recognition of the role financial services can play in improving household resilience and economic development, a report has said.
The country continues to face significant economic challenges stemming from years of high inflation, macroeconomic instability, climate-related shocks and sluggish employment growth, according to the Business Recorder report.
These pressures have weakened household incomes, reduced savings and pushed millions of people into financial hardship, the report noted.
According to estimates cited by the Ministry of Planning, Development and Special Initiatives, the poverty line for 2024-25 is set at Rs 8,484 per adult per month under the Cost of Basic Needs methodology.
Based on this benchmark, around one-third of Pakistan’s population is estimated to be living below the poverty line and unable to adequately meet basic consumption needs, the report stated.
Poverty remains more widespread in rural areas than in urban centres. At the same time, income inequality has increased across the country, with the Gini coefficient rising to 32.7 in 2024-25 from 28.4 in 2018-19. Recent estimates also suggest that income inequality is relatively more pronounced in urban areas.
Against this backdrop, policymakers and economists are increasingly focusing on financial inclusion as a tool to improve household welfare and economic resilience.
Financial inclusion refers to ensuring that people, particularly low-income and vulnerable groups, have access to affordable financial products and services such as bank accounts, savings facilities, credit, insurance and payment systems, the report said.
Experts argue that broader participation in the formal financial system can help mobilise savings, expand credit availability, support business activity and contribute to overall economic growth. However, current levels of access and usage remain low.
Data from the Findex 2025 survey indicate that roughly 133.3 million adults in Pakistan remain unbanked or financially excluded. The survey found that only 18.3 per cent of respondents held a formal financial account, while a similar percentage had a mobile money account. Digital payments accounts were reported by just 19.8 per cent of respondents.
The findings suggest that the majority of Pakistan’s population continues to operate outside formal financial channels. Even among those with access to accounts, usage remains limited. Most account holders primarily use financial services for deposits, withdrawals and storing money, while fewer use them for savings, borrowing or broader financial planning.
