| Welcome to Global Village Space

Wednesday, February 14, 2024

State Bank considering launching digital currency in Pakistan

Governor State Bank of Pakistan (SBP) Dr. Reza Baqir has said that they are ‘carefully studying’ the option to launch a digital currency in Pakistan. He said that the introduction of an SBPs digital currency will have a twofold benefit to Pakistan.

Talking to CNN, Governor State Bank, Raza Baqir highlighted the role the central bank has played in the wake of coronavirus in Pakistan and its vision to digitize the country’s financial sector.

Addressing his views on launching a central bank-issued digital coin in Pakistan, Baqir said, “We are studying that very carefully. We think that some countries like China are already showing the way.”

It is worth mentioning that countries like China and Japan are regulating digital currency by issuing their own.

Talking about the benefits of such a step, he said, “Not only does it gives a boost to our efforts for financial inclusion but second, because it is a central bank-issued digital currency it allows us to make further progress in our fight towards anti-money laundering, towards countering terrorism financing.”

Read More: “There will be unicorns from Pakistan”, says Managing Partner 500 Startups Khailee Ng

He said that the government is expected to announce further development on digital currency in the upcoming months. He added, “For now we have allowed a framework for digital banks to begin operation in Pakistan.”

SBP’s policies have borne fruit as SadaPay, a digital wallet and a debit card company, aiming to build a “neobank” has raised the largest amount of money, $7.2 million in a seed round. It is the largest investment in the country.

On the inquiry regarding the entry of major global fintech including Stripe’s entry into the Pakistani market, Baqir said that fintech like Stripe and other such big international payment providers are ‘very welcome’ in Pakistan.

Stripe is one of the best and famous payment gateways out there and it is not available in Pakistan, however, there have been rumors that the company has been eying entry into the growing digital market.

Raza Baqir said that Pakistan is a great potential market for all such companies as most of the population is tech-savvy and there is a budding youth potential in the technology sector of the economy.

The Governor SBP said, “We are very open and we embrace any global mobile payment operator that wants to come to Pakistan.”

Read More: This is why we must urgently adopt digital cash in Pakistan

Speaking on the government’s new initiative, RAAST, Mr. Baqir said, “Often corruption comes with cash, and that’s why RAAST, meaning direct, meaning the correct way to make payments.”

He appreciated the idea that it is an instant transfer system and the fact that RAAST will be increasing financial inclusion, as even though right now, Pakistan has low reliance on banks, and this system will increase accessibility, incentivizing people to go digital.