Is Pakistan launching digital currency?

KARACHI: After making impressive progress in digital banking, the State Bank of Pakistan (SBP) is planning to launch a digital currency in the future, The News reported Friday.

Central Bank's Digital Financial Services Group Additional Director Shoukat Bizinjo said that a large number of central banks around the world, including Pakistan's, are studying CBBCs (callable bull/bear contracts) in order to launch digital currency in their respective countries.

Bizinjo — while speaking at the 16th international conference on Mobile Commerce 2023 —  said: "Pakistan's central bank is reviewing and consulting with other central banks in this regard (CBBCs and digital currency)." 

They are leveraged investments that track the performance of the underlying assets without requiring investors to pay the full price required to own the actual assets. Bizinjo said that the SBP is also in consultation with local industrial players to introduce digital currency.

He said that Electronic Money Institutions (EMIs) have made remarkable progress in e-banking through the launch of e-money wallets for consumers and merchants, and other digital payment instruments such as prepaid cards and contactless payment instruments.

Currently, the country has four live commercial EMIs, including NayaPak, Finja, CMPECC, and Sada Tech Pakistan. EMIs have an outstanding e-money balance of Rs2 billion, managing 1.6 million e-money wallets and 2.4 million payment cards as of March 31, 2023.

There are around 12 EMIs at different stages of acquiring licenses from the central bank. There are also dozens of companies that are in constant talks with the SBP to become EMIs.