KARACHI: The State Bank of Pakistan (SBP) has announced the launch of the Pakistan Express Clearing System (PECS) to strengthen the country’s digital payments ecosystem and improve the efficiency of cheque clearing and settlement.
According to a circular issued by the central bank’s Digital Innovation and Settlements Department, PECS will introduce cheque truncation, under which cheques will be cleared using electronically captured images rather than the physical instruments.
Under the new system, all subsequent stages of the clearing process will be carried out using the electronic cheque image and associated clearing data.
The implementation of PECS will begin on October 15, 2026, initially on a pilot basis with a limited number of participants and within a limited scope. The system will subsequently be expanded, with nationwide implementation planned by April 30, 2027.
How the new system will work
Under PECS, the presenting or collecting bank will capture an image of a cheque or other instrument and transmit it electronically to the Clearing House, operated by the National Institutional Facilitation Technologies (NIFT).
The Clearing House will then forward the electronic image and relevant data to the paying or drawing bank for processing.
The SBP has directed NIFT member financial institutions to take necessary measures to train relevant staff, ensure compliance with applicable laws and regulations, and create awareness among customers about the new system.
Implementation in phases
According to the implementation plan, the initial pilot phase will run from October 15 to November 15, 2026, at selected clearinghouse-participating institutions designated by the SBP in consultation with NIFT.
Following the pilot, NIFT and participating institutions will review the results, address any issues and submit a consolidated readiness report to the central bank.
The second phase will run from November 16 to December 31, 2026, during which the system will be extended to the remaining clearinghouse members.
All participating institutions will operate PECS in accordance with the prescribed rules and progressively expand cheque-truncation capabilities across their branch networks.
During the pilot phase, an additional PECS clearing cycle will be conducted daily from October 15 to December 31, 2026. The clearinghouse will submit the additional cycle to the SBP by 3pm each day.
Nationwide rollout by April 2027
The complete rollout of PECS is scheduled for April 30, 2027.
The SBP said all NIFT members would be required to develop the necessary infrastructure, meet the clearinghouse’s technical requirements and achieve nationwide implementation by the deadline.
Relevant financial institutions will also nominate focal persons for PECS implementation and report progress to the SBP.
