Pakistan adds facial recognition to currency-exchange checks

The State Bank of Pakistan has asked exchange companies to start using facial recognition for customer verification alongside existing thumb and fingerprint scans, introducing a dual biometric system aimed at tightening security and improving transparency in the foreign exchange market.

In a circular issued this week, the central bank said the Ministry of Interior and Narcotics Control had instructed that facial recognition be incorporated into all biometric verification conducted through the National Database and Registration Authority (Nadra). The new requirement will take effect on Jan. 1, 2026.

The State Bank has directed exchange companies to make the necessary administrative and technical preparations to ensure compliance before the deadline.

Officials from exchange companies said they already use Nadra’s real-time system to authenticate customers’ thumb and fingerprint data before processing any foreign exchange transaction, as required by the central bank. Firms are also obligated to maintain CCTV footage for at least six months.

The addition of facial recognition is intended to create a more uniform and secure verification process and reduce the risk of identity fraud in Pakistan’s currency market, which has faced scrutiny amid concerns over illicit financial flows.

Analysts say the move signals tighter oversight of the foreign exchange sector at a time when Pakistan is working to curb money laundering and stabilize the rupee.

“This step will bring Pakistan closer to global compliance standards,” said a financial analyst. “Dual biometric checks make it harder for individuals to use fake or stolen identities, which has been a persistent challenge in regulating the open currency market.”

Pakistan’s foreign exchange market has undergone a series of regulatory changes in recent years as the government seeks to improve transparency and address concerns raised by the IMF and global anti-money laundering bodies. The State Bank has increased monitoring of exchange firms, imposed stricter documentation requirements, and launched crackdowns on illegal currency trading.

Authorities say enhanced verification measures, including facial recognition, will help prevent identity manipulation, support law enforcement efforts, and strengthen the integrity of foreign exchange transactions.

The tighter rules come as Pakistan continues broader financial reforms aimed at stabilizing the economy, protecting the banking system, and ensuring compliance with international standards.