Islamabad, Oct 27, 2025:
Banks across Pakistan have sharply increased their service fees and transaction charges after the government enforced new tax measures.
The higher taxes and revised fee structures have made routine financial transactions significantly more expensive for customers, especially non-filers.
The federal government raised the withholding tax rate on cash withdrawals by non-filers from 0.6 percent to 0.8 percent. As a result, a non-filer withdrawing Rs. 50,000 now pays Rs. 600 in tax instead of Rs. 400 earlier.
At the same time, banks raised multiple service charges, citing new rates introduced by 1LINK, the national interbank payment network.
Banks increased the fee for using another bank’s ATM from Rs. 23 to Rs. 34 per transaction and raised the annual ATM card maintenance fee by Rs. 700. They also raised the SMS alert service fee from Rs. 1,200 to Rs. 2,000 per year. In addition, banks now deduct Rs. 522 in taxes from non-filers who withdraw Rs. 20,000 over the counter through cheques.
Banks also revised daily withdrawal limits. Standard debit card holders can now withdraw between Rs. 25,000 and Rs. 50,000 per day, while premium card holders can access up to Rs. 500,000 daily.
Holders of foreign debit cards may withdraw the equivalent of USD 200 to USD 500 per day. Any withdrawal exceeding Rs. 50,000 in a single day automatically triggers tax deductions.
The steep rise in charges has angered customers nationwide and sparked frequent arguments between clients and bank staff. In response, several banks have asked 1LINK to review the new schedule of charges, warning that the rising costs could discourage digital transactions.
Since the start of the 2025–26 federal budget, the public has begun to feel the financial strain. The combined effect of higher taxes, increased fees, and new withdrawal limits has added to people’s economic burdens.
Financial analysts warn that these measures could push more Pakistanis toward cash-based transactions and slow the country’s progress toward a digital banking economy.