The government of Pakistan has put forth amendments to the State Bank of Pakistan (SBP) Act to acknowledge central bank digital currencies (CBDCs) as lawful tender. These modifications would empower the central bank to issue, regulate, and oversee digital currency in both digital and physical formats. The amendments augment Section 24 to incorporate digital issuance alongside traditional banknotes, characterizing digital currency as “a digital form of currency issued by the bank under section 24 as legal tender under section 25.” Section 24 bestows the SBP with the authority to issue currency, and Section 25 designates it as legal tender.
To deter unauthorized issuance, the amendments introduce penalties amounting to twice the value of any illicit digital currency. Moreover, the proposal eliminates restrictions on dual nationals holding senior positions within the SBP, overturning a regulation established under the guidance of the International Monetary Fund (IMF) in 2022. The amendments also extend board powers to approve significant financial reports and streamline governance by updating meeting protocols for the board chairperson and non-executive directors.
