SBP Denies Issuing Polymer Banknote Reports

The State Bank of Pakistan (SBP) has vehemently rejected reports suggesting the replacement of paper currency with polymer (plastic) banknotes. Describing the reports as unfounded and lacking substance, the SBP stated that there is currently no plan or proposal to switch from paper to polymer substrate for banknotes. It emphasized that the SBP utilizes locally manufactured cotton-based paper substrate, primarily sourced from local raw materials by the Security Papers Limited.

Earlier, there were reports claiming that the central bank intended to introduce plastic currency notes to combat the circulation of counterfeit banknotes. It was reported that the SBP would discuss this plan with the International Monetary Fund (IMF) team during their visit to Pakistan for discussions on the next installment of the $3.3 billion bailout package.

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Similar rumors had emerged in 2021, suggesting the government’s intention to replace paper currency with plastic notes. However, the SBP had dismissed these rumors at the time, labeling them as fake news circulating on social media. The central bank clarified that there was no such proposal under consideration.

The SBP had last redesigned the Rs500 currency note in January 2010, followed by the introduction of a new design for the Rs1,000 note in February 2007 and the Rs5,000 note in May 2006.