The federal cabinet has approved replacing the Rs10 banknote with a coin of the same denomination, marking a major policy decision months after the State Bank of Pakistan (SBP) dismissed reports of its discontinuation. According to a statement from the Prime Minister's Office, the cabinet received a detailed briefing on the proposed designs, which were developed after seeking suggestions from artists and designers across the country.

A cabinet committee constituted by the prime minister also held extensive consultations with relevant stakeholders before the designs were presented for approval. Modern materials would also be used to improve the durability and lifespan of the currency.

At the time, the SBP described the reports as baseless, saying a proposal for a new banknote series was under consideration by the federal cabinet and no decision had been taken on replacing or discontinuing any denomination. The central bank had also clarified that any decision regarding the withdrawal of banknotes would be formally communicated to the public, with adequate time provided for exchanging discontinued currency.

Earlier, SBP Deputy Governor Dr. Inayat Hussain had informed the Senate Standing Committee on Finance that the central bank was considering discontinuing the Rs10 banknote because of its rising production cost. He had also disclosed that the SBP had made two previous attempts to discontinue the denomination.

Financial experts point out that low-denomination paper notes suffer from rapid wear and tear due to heavy daily circulation, making coins a more cost-effective and durable alternative in the long run. The central bank is expected to announce a specific timeline for the rollout of the new coins and the phased withdrawal of the existing paper banknotes.

Citizens will be given ample opportunity to exchange their old Rs10 notes at commercial banks and SBP banking services corporation offices across the country once the transition begins.