SBP opens banking access for licensed crypto firms

April 15, 2026 (MLN): State Bank of Pakistan (SBP) moves to allow regulated financial institutions to engage with Pakistan Virtual Asset Regulatory Authority (PVARA) licensed Virtual Asset Service Providers (VASPs) under an updated framework replacing the earlier 2018 restriction on virtual currencies and tokens.

Marked a shift toward a supervised virtual asset ecosystem aligned with the Virtual Assets Act 2026 and the newly established PVARA regulatory regime.

Under the revised structure, PVARA functions as the statutory authority responsible for licensing, regulation, supervision and oversight of virtual asset activities in Pakistan, and banks regulated by SBP may open accounts for entities holding valid VASP licenses issued by PVARA, according to SBP notice.

Prior to onboarding any such entity or initiating services, banks are required to obtain and independently verify the authenticity of the PVARA license and retain it on record.

For operational handling of client-related flows, banks may establish separate transactional accounts designated as Client Money Accounts (CMAs) for licensed VASPs.

These accounts are required to be strictly segregated from all other accounts of the VASP, ensuring complete separation of client funds from the VASP’s own operational funds, while preventing any commingling.

CMAs are to be maintained in Pakistani rupees, operate on a non-remunerative basis, and are restricted to settlement of authorized transactions only.

Cash deposits and withdrawals are not permitted in these accounts, and balances held cannot be used as collateral or security for any form of financing or credit facility.

Financial institutions are required to implement enhanced customer due diligence measures before and during engagement with VASPs, including comprehensive assessment of the VASP’s business model, scope of activities, customer onboarding procedures, customer base, and geographic exposure.

Banks are also required to adapt their customer risk profiling frameworks to incorporate virtual asset-related risks and apply appropriate risk ratings supported by strengthened monitoring systems.

Ongoing relationship monitoring is mandatory, with banks required to detect and report any suspicious transactions to the Financial Monitoring Unit in accordance with anti-money laundering obligations under the AML Act 2010 and relevant SBP AML/CFT/CPF regulations.

Entities that hold No Objection Certificates issued by PVARA may be provided limited-purpose banking facilities solely for completing licensing requirements, with full transactional capabilities including virtual asset-related services becoming available only after formal licensing approval.

Banks and regulated entities remain prohibited from investing in, trading, or holding virtual assets using their own funds or customer deposits, and continue to remain fully responsible for compliance with foreign exchange and all applicable regulatory requirements, regardless of any arrangement with a VASP.

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