State Bank of Pakistan to launch image-based cheque clearing in October 2026

The State Bank of Pakistan has announced the launch of the Pakistan Express Clearing System (PECS), under which cheques will be processed using captured images instead of the original instruments being physically moved between banks. The central bank said the mechanism is intended to improve the efficiency of cheque clearing and settlement and to support the country's digital payments ecosystem.

Under the arrangement, the bank receiving a cheque for collection will capture its image and transmit it to the clearing house operated by National Institutional Facilitation Technologies (NIFT), which will then forward the image to the bank on which the cheque is drawn for processing. The SBP said the system is based on the concept of cheque truncation defined under Section 2(zl) of the Payment Systems and Electronic Fund Transfers Act, 2007, allowing processing to take place on the basis of digital images rather than physical instruments.

According to the central bank, implementation will begin on 15 October 2026, initially as a pilot project, with nationwide implementation scheduled for completion by 30 April 2027. Financial institutions have been directed to raise public awareness of the new system through print, electronic and social media, and to train relevant staff on the cheque truncation process.

The SBP said financial institutions must continue to comply with applicable laws and regulations, including the Payment Systems and Electronic Fund Transfers Act, 2007 and the Negotiable Instruments Act, 1881.