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Govt sets new deadline for replacing old currency notes

The State Bank of Pakistan (SBP) sought a six-year extension for the replacement of currency notes. However, the cabinet only approved a 12-month extension. Individuals with old notes of Rs 10, Rs 50, Rs 100, and Rs 1000 should replace them with the current ones.

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The Federal Cabinet set a 12-month deadline for the replacement of old currency notes. Individuals with old notes of Rs 10, Rs 50, Rs 100, and Rs 1000 should replace them with the current ones.

Minister for Information and Broadcasting Fawad Chaudhry revealed the news while talking to the media after the Cabinet meeting.

“Those who want to get currency notes changed should get it done in a year,” he added.

The State Bank of Pakistan (SBP) sought a six-year extension for the replacement of currency notes. However, the cabinet only approved a 12-month extension.

Read more: Pakistan’s foreign-currency bonds got a B- rating, but with a stable outlook

Important to note, the previous government banned the use of old-design currency notes with effect from December 1, 2016. The notes for Rs10, Rs50, Rs100, and Rs1,000 had been declared as trash paper.

However, it allowed the exchange of old banknotes from commercial banks by the end of November 2016 and from the SBP Banking Services Corporation (BSC) field offices till December 31, 2021. Now the incumbent government further extended the deadline on the recommendation of SBP and the Ministry of Finance.

Interestingly, last month, pictures of new currency notes circulated on social media, implying that the SBP introduced new notes in the market. The pictures showed new currency notes for Rs.50, Rs.100, Rs.1000, and Rs.5000. In response, the SBP rejected the pictures and called them fake.

“Some fake news regarding new designs of currency notes is circulating on social media. SBP categorically denies the news and clarifies that no such proposal is under consideration at the moment,” it said in a statement on Twitter.

Pak currency continues to devalue

Earlier, the rupee witnessed a massive depreciation from Rs123 against the US dollar in August 2018 to Rs177 in December 2021. The Pakistani rupee’s value against the US dollar fell by 30.5% during the incumbent PTI-led government’s tenure. Experts believe the devaluation caused inflationary pressures.

Pertinent to note, the only other higher devaluation occurred when Dhaka fell. Pakistan’s currency devalued by 58 percent from Rs4.60 to Rs11.10 against the US dollar in 1971-72.