The new system will initially operate on a pilot basis from October 15, with nationwide coverage targeted by April 30, 2027.
The State Bank of Pakistan (SBP) has introduced 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 an SBP notice dated October 5, 2026, the new system will be implemented on a pilot basis from October 15, 2026, before being rolled out nationwide by April 30, 2027.
The initiative is designed to modernise cheque clearing by using electronic transmission of cheque images rather than relying on the physical movement of cheques between banks.
How Pakistan Express Clearing System Works
PECS will operate under the concept of cheque truncation defined in Section 2(2) of the Payment Systems and Electronic Fund Transfers Act, 2007.
Under the new mechanism, cheque images will be captured by the presenting or collecting bank and transmitted electronically to the National Institutional Facilitation Technologies (NIFT) for onward transmission to the paying or drawing bank.
The system is expected to improve the efficiency of the existing cheque clearing and settlement process by reducing reliance on physical cheque movement.
The SBP notice was addressed to all clearinghouse members and sets out requirements for financial institutions participating in the new system.
Pilot Phase to Begin on October 15
Implementation of PECS will initially begin as a pilot from October 15, 2026, with participating institutions expected to follow the rules, procedures and operational instructions issued for the system.
The SBP has set April 30, 2027 as the target for completing implementation with nationwide coverage.
Financial institutions have also been instructed to take adequate measures to create public awareness about PECS through print, electronic and social media channels.
Relevant staff will also need to undergo training covering the new process and operational requirements.
Banks Required to Ensure Compliance
While operating the system, financial institutions will be required to comply with all applicable laws and regulations issued from time to time.
The SBP specifically referred to the Payment Systems and Electronic Fund Transfers Act, 2007 and the Negotiable Instruments Act, 1881 in its implementation instructions.
The launch of PECS marks another step towards greater digitalisation of Pakistan’s payment infrastructure, particularly for cheque processing. By enabling electronic transmission of cheque images, the system is intended to streamline clearing operations while reducing the need for physical movement of instruments.