Islamabad, Pakistan Pakistan is actively considering the introduction of a rupee-backed stablecoin, as well as a central bank digital currency (CBDC), in a concerted effort to widen financial inclusion, particularly among the country’s more than 100 million unbanked adults. According to recent reports, officials from the State Bank of Pakistan (SBP) and the Pakistan Banks' Association (PBA) cited the initiative as part of the nation’s strategy to tap into up to $20-25 billion in economic opportunity through digital assets.
During the November 2025 conference of the Sustainable Development Policy Institute (SDPI), PBA President Zafar Masud declared that Pakistan must act quickly to shape regulations around stablecoins and digital assets to avoid “losing the window” of growth. He emphasised that a rupee-pegged stablecoin could serve as a foundational step toward the broader digital-currency ecosystem.
Meanwhile, the SBP’s Deputy Director of Payments, Faisal Mazhar, revealed that a prototype of a Pakistani CBDC is already in development with support from the World Bank and the International Monetary Fund (IMF). The plan is to launch a pilot programme ahead of a full-scale roll-out.
Why It Matters
Pakistan’s move toward a rupee-backed stablecoin touches on multiple strategic goals:
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Financial inclusion: With a large portion of the population excluded from traditional banking, a digital-asset vehicle rooted in the local currency could enable easier access to payments and savings. Experts say the stablecoin could especially benefit micro-remittances and everyday transactions.
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Remittance cost reduction: Pakistan received over $30 billion in remittances in fiscal year 2024. A rupee -linked stablecoin and CBDC could streamline cross-border flows and reduce transaction fees.
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Economic opportunity: Analysts estimate that failure to act could cost Pakistan between $20-25 billion in missed digital-asset growth. That potential return underscores the urgency cited by regulators.
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Regulatory and market readiness: This initiative aligns with Pakistan’s recent regulatory reform, including the establishment of the Pakistan Virtual Asset Regulatory Authority (PVARA) under the Virtual Assets Ordinance 2025, and the inviting of foreign crypto-asset firms to apply for licences.
Implementation Challenges and Considerations
While the benefits are significant, several obstacles must be addressed:
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Stability and peg maintenance: Ensuring the rupee-backed stablecoin holds its value and remains backed by appropriate reserves will be key to maintaining user trust.
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Cybersecurity and fraud protection: Officials have flagged cybersecurity as a major risk in the rollout of digital-asset infrastructure.
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Energy and infrastructure costs: Deploying a stablecoin and CBDC at scale requires robust payments infrastructure and oversight to avoid issues with scale, latency or service disruption.
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Public perception and regulatory clarity: Misunderstandings about digital assets remain widespread, and the authorities emphasise the need for clear rules and consumer-protection frameworks.
What to Watch Next
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When and how a pilot for the rupee-backed stablecoin will be announced, and which entities (banks, fintechs or state-linked) will issue it.
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How inter-agency coordination (between SBP, PVARA and others) progresses in developing a workable legal and regulatory framework.
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The structure of backing and reserves for the stablecoin whether fully backed, partially algorithmic or hybrid.
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User-adoption strategies, particularly for the unbanked through mobile wallets, retail networks, and offline access points.
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International collaboration (e.g., IMF, World Bank) and how Pakistan positions itself compared to other countries pursuing similar initiatives.
FAQs
Q1: What is a rupee-backed stablecoin and how might Pakistan implement it?
A rupee-backed stablecoin is a digital token pegged 1 : 1 to the Pakistani rupee, intended for everyday payments and remittances. Pakistan plans to explore such a digital asset alongside its CBDC roadmap, aiming for financial-inclusion gains.
Q2: Why does Pakistan want to launch a rupee-linked stablecoin now?
Officials believe the nation could unlock up to $20-25 billion in digital-asset-related economic activity while improving access for the unbanked many of whom have little interaction with traditional banking.
Q3: How does this relate to Pakistan’s CBDC plans?
The rupee-stablecoin is seen as a step toward broader digital-currency infrastructure. The SBP is developing a CBDC prototype in partnership with global institutions, with a pilot expected ahead of full launch.
Q4: What benefits could this bring for remittances?
By digitising payments and leveraging blockchain rails or akin infrastructure, remittance costs can be lowered and settlement times improved an important factor given Pakistan’s heavy dependence on remittance inflows.
Q5: What are the biggest risks associated with a rupee-backed digital coin?
Risks include currency devaluation, failure to maintain reserves, regulatory ambiguity, cyber-security threats and insufficient infrastructure or adoption among target users.
Q6: When could the rupee-backed stablecoin launch?
No official launch date has been set yet. Currently, discussions and prototyping are underway, with pilot programmes anticipated before a full rollout though timelines depend on regulatory and technical readiness.
