SBP Deputy Governor Dr Inayat Hussain shared the details during a meeting of the Senate Standing Committee on Finance. The meeting was chaired by Senator Saleem Mandviwalla.
Dr Inayat Hussain said the SBP had sought approval to stop issuing the Rs10 note. He added that the bank would end its printing once the new currency series is launched.
The decision has been linked to the increasing cost of producing the Rs10 note. The SBP believes using a coin instead would be more practical and cost-effective.
The committee also discussed the designs of the new currency notes. A committee headed by the finance minister had earlier rejected the designs submitted by the SBP.
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Dr Inayat Hussain said the central bank was now working on the recommendations given by the committee. The SBP also plans to introduce additional security features and make further changes to the designs.
The meeting also covered concerns over the circulation of counterfeit currency. An SBP executive director said changing the designs of banknotes would not by itself completely prevent the circulation of fake currency.
SBP officials told the committee that counterfeit Rs1,000 and Rs5,000 notes are currently the most common.
Mandviwalla said counterfeit notes had also been dispensed through banks and ATMs. He said the situation had become serious enough that some shopkeepers were refusing to accept Rs1,000 and Rs5,000 notes.
Dr Inayat Hussain, however, said the circulation of counterfeit currency in Pakistan remained lower than in several other countries.
Mandviwalla noted that the SBP had started printing the current currency series in 2005. He said the central bank was now preparing to introduce an entirely new series of banknotes.
The committee chairman also claimed that the SBP had hired a consultant to work on the designs of the new notes. According to Mandviwalla, the central bank owed the consultant Rs15,000 and had not made the payment for the past two years.
He further claimed that the consultant had submitted three designs to the SBP two years ago, but the central bank had still not returned them.