business
Monday Dec 05 2022
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When is the last date to exchange old banknotes?

A representational image of old news and the new notes which have replaced those. — SBP
A representational image of old news and the new notes which have replaced those. — SBP 

The old-designed large-size banknotes of Rs10, Rs50, Rs100 and Rs1,000 can be exchanged from the State Bank of Pakistan (SBP) till December 31, 2022.

Last year, the federal government vide Gazette Notification F.No.2(1)IF-III/2010 dated December 23, 2021, extended the last date for the exchange of old designed large-size banknotes.

However, in a statement issued today the central bank clarified that December 31, 2022, is the “last and final deadline for exchange of such banknotes, upon expiry of which, these banknotes shall no longer be exchangeable from the counters of the SBP Banking Services Corporation (BSC) and thus will lose their value.”

The holders of these old designed large banknotes can exchange these notes from the field offices of the SBP BSC by December 31 in order to protect the value of their savings in these banknotes.

Why are the notes replaced?

It should be noted that the State Bank is the sole issuer of banknotes in the country ensuring an adequate supply of good quality banknotes across the country is among its key strategic goals.

The SBP collects soiled and unfit banknotes from the market and replaces them with fresh ones. Like other central banks, the SBP issues new series of banknotes from time to time and demonetises the earlier series with the federal government's approval.

Furthermore, the approval for the demonetisation of banknotes is granted by the federal cabinet on the recommendations of the SBP Board in terms of section 25(2) of the SBP Act, 1956.

The issuance of new series and demonetisation of the old-designed banknotes helps central banks in checking to counterfeit and ensuring the integrity of banknotes in circulation.

The new series of banknotes was issued from 2005 to 2008 and the old design banknotes have been slowly phased out from circulation. The federal government had therefore decided to demonetise old design banknotes of Rs10, Rs50, Rs100 and Rs1,000.