In 2025, Pakistan did not just dip a toe into the waters of financial reform, it cannonballed in, fully clothed, clutching a briefcase of policy documents and an outdated calculator. The country, long entangled in the spaghetti of cash economies, informal dealings and regulatory déjà vu, decided to grow up, or at least try. What followed was a year of transformation, occasionally visionary, sometimes chaotic, but never boring.

At the epicentre of this fiscal glow-up was a long-overdue reality check: digital finance was not going anywhere, and pretending otherwise was starting to look tragic. The government, having previously treated crypto currencies like Voldemort - he who must not be named - finally uttered the words and passed the Virtual Assets Ordinance in July. This was not just a U-turn; it was a handbrake drift into the future. Suddenly, Pakistan was open for blockchain business. The start-ups that had not already left for Dubai got a reason to unpack.

Enter the Pakistan Virtual Asset Regulatory Authority, a new sheriff in town, sans the ’90s bureaucracy. Built from scratch (read: not inherited from a cousin of a cousin in some ministry), it came armed with modern tools, global standards and a clue. For once, the message was clear: innovate all you want, just do not expect any longer to do it in the dark.

But even optimism has its curfew. An 18-month regulatory sandbox was rolled out: not a crypto free-for-all, but more of a supervised science fair where blockchain experiments could tinker under the watchful gaze of regulators with clipboards, spreadsheets and a mild caffeine dependency. Shariah compliance was baked in from day one, not just sprinkled on top like halal glitter. Every digital asset had to pass both the code review and the ethical sniff test. It is no longer just about making tech work; it is also about making it work right. The goal? Build a bridge between faith and finance without setting either on fire. It was a bold move; and a surprisingly elegant one.

The State Bank decided to join the digital currency party, not fashionably late, just... confusingly dressed. The pilot of the digital rupee began: a quiet, cautious and deeply symbolic move signaling that even the rupee wanted a sleek new app icon.

Policy papers do not digitise economies; people do. So, the government unleashed a full-blown digitisation campaign that can only be described as enthusiastic, bordering on aggressive. Biometric verification became mandatory for every bank account and mobile wallet. Missed the deadline? Tough. Grace periods were for the weak.

This rolled neatly into the launch of Digital Wallet System 2025, Pakistan’s bold leap toward a cashless economy. There was no “opt-out” button. Spearheaded by the Benazir Income Support Programme, the system linked welfare payments (like BISP’s Rs 13,500 instalments) directly to biometrically verified mobile wallets. Urban shopkeepers got QR codes; rural citizens got onboarding tutorials, and suddenly, digital payments were no longer just for the tech-savvy, but for anyone with a thumbprint and a phone. The RAAST system, once a polite afterthought in PowerPoint presentations, became a full-blown transactional juggernaut, moving Rs 80 trillion with the quiet confidence of a fin-tech that actually works. Financial inclusion got a real upgrade. For once, transparency wasn’t just a buzzword, it was built into the code.

Of course, where there’s money, there’s the taxman. In 2025, he came armed. The Tax Laws (Amendment) Ordinance let FBR officers camp out at business premises for “real-time monitoring,” which sounded like surveillance and felt like it too. E-commerce? Digitally delivered services? You’re all in the net now. Even real estate, the sacred cow of untaxed fortunes, got a trim, stamp duty doubled for tax dodgers. Subtle? No. Effective? You bet.

Within the bureaucratic machine, the regulators finally did some spring cleaning. The SECP rolled out shareholder reforms, because apparently, “one share, one vote” was not obvious enough. The State Bank, ever the cautious guardian, demanded recovery plans from banks like overachieving helicopter parents reviewing their kids’ emergency contact lists.

Even NBFCs, the forgotten middle child of the financial sector, got some love. Loan limits were raised, suggesting that maybe, just maybe, the financial system was finally interested in helping the little guys do something other than fill out forms.

By year’s end, the numbers told their own story, but the real shift was psychological. Pakistanis, accustomed to grey areas, hidden cash and red tape, were slowly warming to a new reality: one where the system might just work; at least some of the time; sort of; maybe.

Whether this digital dawn becomes a golden age or just a high-tech mirage remains to be seen. For now, it seems that 2025 will be remembered as the year Pakistan looked at its outdated financial system, sighed deeply and said: “Fine, let’s upgrade it. But we’re not smiling.”

The writer is an advocate of the High Courts and governance lead at a fin-tech. She can be reached at [email protected]