Following consent from the federal government, the State Bank of Pakistan (SBP) has extended the deadline for exchanging the obsolete banknotes of four denominations that were demonetized six years ago.
The central bank announced on its official website that the government has extended the deadline for exchanging the ancient, large-sized Rs. 10, 50, 100, and 1,000 banknotes until December 31, 2022.
The SBP ordered that these obsolete currency notes be exchanged by the general public at the local offices of commercial banks and SBP’s Banking Services Corporations.
“These banknotes are exchangeable at SBP BSC Offices located in Karachi, Lahore, Peshawar, Quetta, Islamabad, Rawalpindi, Faisalabad, Multan, Gujranwala, Hyderabad, Sialkot, Sukkur, Bahawalpur, Muzaffarabad and D I Khan,” the statement read.
Why are the notes replaced?
The central bank clarified that the state bank is the sole issuer of banknotes in the country. Ensuring an adequate supply of good quality banknotes across the country is among its key strategic goals.
“SBP replaces dirty and unsuitable banknotes with new ones after removing them from the market. With the federal government’s approval, the SBP, like other central banks, occasionally releases new series of banknotes and demonetizes older series, according to the statement.
Additionally, in accordance with section 25(2) of the SBP Act from 1956, the federal cabinet approves the demonetization of banknotes based on recommendations from the SBP Board.
The SBP stated in a statement that the introduction of new series and the demonetization of old-style banknotes will enable central banks in resisting counterfeiting and preserving the integrity of in-circulation banknotes.
The old design banknotes were gradually taken out of circulation as the new series of banknotes was released from 2005 to 2008. Therefore, the federal government has decided to demonetize old design Rs. 10, 50, 100, and 1000 banknotes.