KARACHI: The State Bank of Pakistan (SBP) has announced the Pakistan Express Clearing System (PECS) to improve cheque clearing and strengthen the country’s digital payments system.
The new system will introduce cheque truncation. Banks will clear cheques using electronic images instead of moving physical cheques between institutions.
Banks will also use the electronic cheque image and related data for all later stages of the clearing process.
The SBP will start PECS on October 15, 2026, on a limited pilot basis. The central bank plans to expand the system nationwide by April 30, 2027.
How PECS Will Work
Under PECS, the presenting or collecting bank will capture an electronic image of a cheque.
The bank will then send the image and related data to the Clearing House. National Institutional Facilitation Technologies (NIFT) operates the Clearing House.
The Clearing House will forward the electronic image and relevant data to the paying or drawing bank.
The paying bank will then process the cheque using the electronic information.
The SBP has directed NIFT member financial institutions to prepare for the new system.
Banks must train relevant staff and follow all applicable laws and regulations.
They must also inform customers about the new cheque-clearing process.
PECS Implementation in Phases
The first phase will run from October 15 to November 15, 2026.
During this phase, selected clearinghouse-participating institutions will test PECS. The SBP will select the participants in consultation with NIFT.
After the pilot, NIFT and participating institutions will review the results. They will also identify and address any issues.
The institutions will then submit a combined readiness report to the SBP.
The second phase will run from November 16 to December 31, 2026.
During this phase, NIFT will extend PECS to the remaining clearinghouse members.
Participating institutions will follow the prescribed rules. They will also expand cheque-truncation services across their branch networks.
Additional Clearing Cycle During Pilot
The clearinghouse will conduct an additional PECS clearing cycle every day during the pilot period.
The additional cycle will run from October 15 to December 31, 2026.
The clearinghouse will submit the additional cycle to the SBP by 3pm each day.
Nationwide PECS Rollout by April 2027
The SBP has set April 30, 2027, as the deadline for nationwide implementation of PECS.
All NIFT members must develop the required infrastructure and meet the clearinghouse’s technical requirements.
Financial institutions must also achieve nationwide implementation by the deadline.
Each institution will nominate a focal person to oversee PECS implementation.
They will also report their progress to the SBP as the rollout continues.
