The government has chosen to issue digital currency in order to save money on currency printing and distribution.
The digital currency will also aid in the appreciation of the rupee, the improvement of the economy, and the completion of large financial transactions.
The digital currency will have the same value as the Pakistani rupee, just like a unit of Chinese digital currency, which is equal to one Chinese Yuan.
The Pakistani digital currency, backed by the State Bank of Pakistan, will be issued on the same basis as currency notes. The SBP has begun working on implementing digital currency and is enlisting the help of specialists.
A separate department, Central Bank Digital Currency, is analysing the cost benefits and viability of digital currency in order to ensure smooth transactions following its debut.
The government intends to gradually replace currency notes with digital currency, but it also intends to keep digital currency and currency notes in parallel with an 80:20 ratio, so that in the event of an emergency, an alternate in the form of currency notes is accessible.
The digital currency will also reduce costs associated with creating currency notes, transporting them to various cities, and burning old ones. Furthermore, every digital currency transaction will be documented, which will aid in the effective enforcement of monetary policy.
Digital money has the ability to facilitate cross-border trade and investment while also giving unbanked people access to financial services.
According to the World Bank, it also has the potential to greatly improve the financial industry’s efficiency, robustness, and reliability. One sort of distributed ledger is blockchain.