Pakistan is considering the possibility of introducing digital currency within its borders, Finance Minister Muhammad Aurangzeb said during a session of the World Economic Forum (WEF) on Sunday.

Speaking at the event, Aurangzeb briefly discussed Pakistan’s baby steps towards potentially adopting digital currency.

Separately, Aurangzeb said the government was committed to assisting impoverished women across the country. Furthermore, he brought up a prevalent issue where women often fell victim to cash theft by their family members and advocated for digital wallet solutions to help them.

It bears mentioning that the idea of incorporating digital currency was floated by State Bank of Pakistan (SBP) Governor Jameel Ahmad at a Senate panel meeting in July 2023. Jameel had said SBP was working to launch its own Central Bank Digital Currency (CBDC).

The SBP governor said at the time that the regulator was reviewing work done by other central banks to launch its own CBDC.

For many years, the central bank has be
en in denial about digital currencies while the world chose to move forward. In its Financial Stability Review last year, SBP said such assets can affect the effectiveness of monetary policy as they are not subject to oversight and control like traditional elements of money supply in the economy resulting in weaker monetary policy transmission channels.

According to the report, SBP is also wary of digital currencies creating challenges for FX-related control mechanisms and leading to an untoward outflow of capital that can be a source of concern for a country facing foreign exchange challenges (like Pakistan).

Source: Pro Pakistani