Pakistan is planning to introduce its digital currency to reduce the expenses tied to printing and distributing physical money. This initiative also aims to boost the value of the Pakistani rupee by pegging the digital currency to it, similar to China’s digital yuan. This shift promises economic and financial advantages while ensuring currency stability and potential appreciation.
State Bank’s Initiative
The State Bank of Pakistan (SBP) is taking a lead role in supporting this initiative. Much like physical currency notes, the digital currency will be issued under the government’s guarantee. The SBP is actively collaborating with experts to facilitate the implementation of this digital currency, ensuring a robust and secure financial infrastructure.
To comprehensively assess the feasibility and potential advantages of digital currency adoption, a dedicated department named the “Central Bank Digital Currency” has been established. This department is diligently conducting cost-benefit analyses, ensuring a smooth transition to digital transactions once the currency is launched.
The government’s vision entails a gradual replacement of traditional currency notes with digital currency. However, it also emphasizes the importance of maintaining a parallel existence of both forms, with an 80:20 ratio. This contingency plan ensures that, in unforeseen circumstances, physical currency notes can still serve as a backup.
Beyond the evident cost savings achieved by eliminating currency printing, distribution, and the disposal of old notes, the adoption of digital currency offers several other notable advantages. Every digital currency transaction will be meticulously documented, providing a valuable tool for the effective enforcement of monetary policies.
Stay tuned to Brandsynario for the latest news and updates.
