SBP to Launch Image-Based Cheque Clearing on October 15

The State Bank of Pakistan (SBP) is set to introduce the Pakistan Express Clearing System (PECS) on October 15, replacing the physical transfer of cheques with image-based clearing. The system is expected to be implemented nationwide by April 30, 2027.

PECS will operate through cheque truncation, allowing banks to process cheques using captured images and related electronic information rather than physically transporting the original instruments between institutions.

Under the new mechanism, the presenting or collecting bank will scan and capture an image of the cheque or other instrument and send it electronically to the clearing house, NIFT. The clearing house will then transmit the image and relevant data to the paying or drawing bank for processing.

PECS will initially be introduced as a pilot project involving a limited number of participating financial institutions from October 15 to November 15.

After completion of the pilot phase, NIFT and participating institutions will assess the results, identify and resolve any operational issues, and submit a consolidated readiness report to the SBP through the clearing house.

The second phase will run from November 16 through December 31 and will extend PECS to the remaining NIFT-member financial institutions. During this period, banks and other participating institutions will gradually expand cheque-truncation capabilities across their branch networks.

An additional PECS clearing cycle will also be conducted each day from October 15 to December 31. NIFT will be required to submit this additional clearing cycle to the SBP by 3pm.

Full nationwide implementation of the system is scheduled for April 30, 2027. By that deadline, all NIFT members will have to establish the required infrastructure and extend PECS throughout their respective networks.

The SBP has already circulated the implementation roadmap, rules, procedures and operational instructions to NIFT-member financial institutions.

Participating institutions have been instructed to train relevant employees on cheque truncation, comply with applicable legal and regulatory requirements, and educate the public about the new clearing process.

Financial institutions will also designate focal persons responsible for PECS implementation and provide progress updates to the central bank. Throughout the transition, institutions will be required to meet prescribed clearing timelines, customer service standards and settlement obligations while ensuring that existing banking services continue without disruption.