The purpose of this brief is to present an examination of cryptocurrency and its prospects in Pakistan. It looks at the important participants as well as the dynamics of digital money in Pakistan. Then, it attempts to measure the total ecosystem’s progress in order to facilitate the transition to a digital currency-based economy.


Any currency that is only available in electronic form is referred to as digital currency. For example, you may go to an ATM or a bank and convert an electronic record of your currency holdings into actual dollars. It never gains tangible shape, though. It is always stored on a computer network and shared digitally. Instead of using actual Rupee notes, you may make purchases by transmitting digital cash to businesses using your mobile device. Because of speedier payments, lower costs, smoother international transactions, efficiency, reduced corruption, and maximum financial inclusion, digital money is the way of the future.


Technology is changing the nature of cash quicker than we ever imagined, and it has a significant influence on our day-to-day transactions. The world is entering the area of digital currency, which should not be confused with cryptocurrencies (See Box No. 01). The ease of use of digital currency may eventually force conventional currency into a corner. In this context, various central banks throughout the world are developing Central Banks Digital Currencies (CBDC), with the goal of increasing financial inclusion. Another immediate benefit of digital money would be to bring economic activity out of the shadows and into the documentation and tax net. Unlike cash, digital money transactions cannot be concealed; they are always traceable.

But there’s a catch. Commercial banks are unable to compete with the Central Bank’s low-cost digital currency and transaction systems. So, what happens? Commercial banks would be forced to leave. So, what is the solution? Commercial banks may hold wallets and accounts while central banks serve as infrastructure suppliers and regulators. It would be a two-tier structure, similar to the one Pakistan is implementing.

SBP Interventions for Financial Inclusion Through Digital Currency

Financial inclusion, mostly through digital channels, is frequently regarded as a game changer for a country’s economic progress, and digital money is a vital part in this equation. Many nations have implemented policy measures to improve digital financial inclusion, with varying degrees of success. According to recent estimates, Pakistan trails well behind its rivals in terms of financial inclusion, with just about 20% of its people accessing financial services. The country has been attempting to increase financial inclusion. In this regard, the SBP implemented the following initiatives to accelerate efforts toward financial inclusion using digital currency:

  • 2015 – SBP launched Pakistan’s National Financial Inclusion Strategy (NFIS), which aims to financially incorporate half of the country’s adult population by 2020.
  • In 2018, the SBP launched the Enhanced Financial Inclusion Strategy (EFIS), with the purpose of increasing digital payments, among other things.
  • 2019 – In accordance with the preceding two, Regulations for Electronic Money Institutions were drafted, allowing non-banking institutions to issue e-money to its customers in order for them to make digital payments.
  • However, there are also worries that the digital instant payment system is not advancing quickly enough to reach the poorest individuals, and that financially excluded people are still digitally excluded.
  • A lack of financial literacy was one of the obstacles.
  • Limited internet access.
  • Smartphone penetration is low.

According to the 2020 Financial Inclusion Insights (FII) report, Pakistan’s financial inclusion level remained low, at 21%. The SBP then transitioned to a complete Digital Financial Services (DFS) architecture, which comprises a wide variety of financial services accessible and supplied via digital means. DFS has the potential to improve living conditions, reduce poverty, reduce the budget deficit, and provide equitable income opportunity to all Pakistanis.


On February 4, 2022, the SBP launched Pakistan’s first quick payment system, Raast. The phrase is based on an Urdu word that means ‘right’ or ‘straight’. As the name implies, it provides Pakistanis with rapid, dependable, and zero-cost digital payment services. According to the SBP, the major goal is to promote the use of digital financial services throughout the country. Pakistan has joined a small group of nations that have either developed or are in the midst of developing centralised and interoperable instant payment systems using a future ISO20022 Raast System (See Box No. 02).

Bottom line

It is possible to infer that the trend of digital money is on the increase both globally and in Pakistan. It has already been recognised by participants in this space that new entrants are likewise fascinated by digital money, perceiving its huge potential in the near future. In this backdrop, the Pakistani government and SBP appear to be aware of the changing nature of money and a global move toward digital currency. Thus, SBP is preparing the framework through DFS and Raast to serve as an excellent launch-pad for the harmful shift toward digital money.