KARACHI – State Bank of Pakistan is set to introduce a new cheque-clearing system under which cheques will be processed using captured images instead of physically moving the original instruments between banks, with effect from 15 October 2026.
The State Bank of Pakistan (SBP) has announced the launch of the Pakistan Express Clearing System (PECS), aimed at improving the efficiency of cheque clearing and settlement while supporting the country’s digital payments ecosystem.
Under the new mechanism, the bank receiving a cheque for collection will capture its image and transmit it to the National Institutional Facilitation Technologies (NIFT) clearing house. NIFT will then forward the image to the bank on which the cheque is drawn for processing.
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. The mechanism will allow cheque processing to take place on the basis of digital images rather than physical instruments.
According to the SBP, implementation of PECS will begin on October 15, 2026, initially as a pilot project. Nationwide implementation is scheduled to be completed by April 30, 2027.
Financial institutions have been directed to raise public awareness about the new system through print, electronic and social media. They are also required to train relevant staff on the cheque truncation process.
The SBP said financial institutions must continue complying with applicable laws and regulations, including the Payment Systems and Electronic Fund Transfers Act, 2007 and the Negotiable Instruments Act, 1881.
