The term central bank digital currency (CBDC) is frequently mentioned by many individuals including regulators around the world who see it as one of the ways to enhance the capabilities of fiat through digital finance after traditional banking systems are challenged by cryptocurrencies.
The country of Pakistan without delay continues to introduce new regulations in preparation for the launch of CBDC by 2025.
It is reported that the State Bank of Pakistan (SBP) acted to approve licenses and sign new laws against digital payment companies, Electronic Money Institutions (EMIs) to ensure that they can implement CBDC within the next three years.
EMI's involvement in developing the digital economy will protect financial institutions from cyber security threats, said Finance Minister Asad Umar.
Meanwhile, SBP Deputy Governor, Jameel Ahmad also agreed with Umar's statement by saying that CBDC can also curb the increasing corruption activities, where it originates from fiat money.
Apart from the following steps, the World Bank which wants to help Pakistan establish the new regulations is also the cause of the establishment of CBDC in the country will be achieved.
The enactment of the new regulations is understood to have various positive impacts such as avoiding money laundering and widespread terrorism financing while protecting consumers from any fraud.
Overall, Pakistan's rapid immersion in CBDC has made it among the top 100 countries actively involved in CBDC-related research.
