The Central Bank of Pakistan also known as the State Bank of Pakistan has announced its plans to issue its Central Bank Digital Currency (CBDC) in 2025.
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According to a Pakistani local news outlet, the State Bank of Pakistan (SBP) has signed in new laws for Electronic Money Institutions (EMIs), that is, non-bank entities that offer digital assets services. These new laws will serve as a guideline for the development and implementation of the nation’s CBDC in three years.
Similarly, in the future, these EMIs will be expected to possess a license before they can perform any digital transactions. Also, the Minister of Finance Asad Umar has requested from both the Central Bank and the Federal Investigation Agency that they collaborate to ensure top-notch cybersecurity measures are out in place, especially in the banking sector in readiness for the digitization which is coming.
Local Regulators Calls for Cybersecurity
Umar noted that cybersecurity is fast becoming a growing threat. While he believes that the launch of central electronic money will help promote e-commerce and the digital economy of Pakistan, he is also particular about tightening regulations.
“This new category of institutions will complement the efforts of the government in creating an enabling environment to empower stakeholders in trade and commerce. This will help businesses in improving their productivity and contribute toward positioning the nation for global competition,” Umar started.
As per a statement published by Arab News, the laws for Pakistan CBDC were designed with assistance from the World Bank. The laws bother on topics like outsourcing activities, anti-money laundering, counter-terror financing measures, consumer protection, complaint handling mechanism, oversight, and regulatory reporting.
Jameel Ahmad, the Deputy Governor of SBP mentioned that the aim of the CBDC is to boost financial inclusion, and in turn mitigate corruption and inefficiency, adding that “These landmark regulations are a testament of the SBP’s commitment toward openness, adoption of technology and digitization of our financial system.”
Many other nations are making efforts towards the launch of their CBDCs. The National Bank of Ukraine (NBU) has introduced a concept note on the launch of its digital hryvnia. Equally, the Reserve Bank of India (RBI) has made plans to test its retail CBDC this month.
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