KARACHI: The State Bank of Pakistan (SBP) sees total transformation of cash processing business from manual to automation in next five years and has asked commercial banks to align their plans with central bank in this direction.

“Without the joint action the desired results to improve the quality of currency notes in circulation will not be achieved,” acting Governor State Bank of Pakistan (SBP) Saeed Ahmad said.

He was addressing participants of Conference on Currency Management: Strategies for the Future, organized by State Bank of Pakistan on Tuesday

The conference covered important topics like Banknote Printing in Pakistan, Currency Management Challenges, Global Trends and Developments in Security Ink and Ink-Based Security Features, Evolution of Banknote Security Features in Pakistan, Global Trends and Developments in Security, Paper/ Paper-based Security Features of Banknotes and Pakistan’s Experience, Challenges Related to Automation of Cash Operations and Automation of Banknote Processing.

Saeed Ahmad said that banknotes are face of a central bank and ensuring circulation of clean notes, removal of soiled and counterfeit notes, and redistribution of fit notes in the system is amongst key responsibilities of the SBP.

He further added that all necessary steps are being taken to this effect. Ahmed hoped that the deliberations and recommendations coming out from this conference would enable State Bank to align its currency management policies and strategies with international best practices.

“Being cognizant of this responsibility, SBP has been investing significant human and financial resources to take this important function to higher level,” he said. He admitted that while SBP and Pakistan’s banking industry was largely at par with international best practices and standards both in regulation and supervision and service delivery, however, they were quite behind in modernizing and automating its currency management processes.

Saeed Ahmad elaborated that the SBP had been making extensive efforts to implement its clean notes policy for the last 10 years but with limited success largely due to lack of automation in cash processing.

“We have thus planned fast track automation of currency management function both at the central bank and commercial banks level,” he added. He also underscored the role of commercial banks in automation of their cash processing systems.

The Acting Governor elaborated that automation of cash processing at SBP was necessary but it could not be effective in achieving its objective of ensuring adequate and uninterrupted supply of high quality and clean banknotes across the country unless commercial banks also automated their cash processing systems.

It may be mentioned here that the State Bank was developing a documentary for educating the masses about the security features of banknotes. Further, a smart phone application on Pakistani banknotes designs and security features was also being developed for enhancing public awareness.

Earlier, Kazi Abdul Maktadir, Deputy Governor Operations, who is spearheading the exercise while elaborating the challenges faced in currency management indicated that despite emergence of various alternatives to cash based transaction in Pakistan, hard cash remains to maintain its predominant position.