The News, the government has decided to introduce digital currency in an effort to reduce the cost of producing and distributing cash.
Govt introduce digital currency to stabilse rupee: The use of digital currency will also benefit the economy, rupee value, and large-scale financial activities.
The value of the digital currency will be equivalent to one Pakistani rupee, much like one Chinese Yuan is equal to one unit of digital money in China.
“The State Bank of Pakistan will support the issuance of the digital currency in Pakistan, which will be back by the government, much like banknotes.” The SBP has begun work on implementing digital currency, and it is hiring experts to help.
A specialised division, Central Bank Digital Currency, is investigating the feasibility and cost-benefits of the digital currency in order to ensure smooth transactions following its debut.
The government aims to gradually replace currency notes with digital money, but it also wants to maintain a parallel system of 80:20 digital currency and currency notes so that there is always a backup in the form of currency notes available in case of emergency.
Additionally, the digital currency will reduce costs associated with creating new currency notes, delivering them to various cities, and shredding old ones. Every transaction conducted using digital currency will be recorded, making it easier to efficiently enforce monetary policy.
Additionally, there is a great deal of potential for digital money to promote international business and investment while giving unbanked people access to financial services.
The World Bank asserts that it also has the potential to considerably increase the effectiveness, adaptability, and dependability of the financial sector. One kind of distributed ledger is the blockchain.