In order to mitigate the risk of a drop in foreign currency inflows, the State Bank of Pakistan (SBP) has increased profit margins of authorized dealers in foreign exchange and microfinance banks, on bringing workers’ remittances through legal channels.
Furthermore, this step will also help Pakistan manage foreign exchange reserves in a better way amidst the coronavirus pandemic.
According to the issued circular, the central bank has enhanced the fund transfer fee from 10 Saudi riyals to 20 Saudi riyals to be paid to the international fund transfer firms on a transaction amounting $100-200 to Pakistan.
“The prevailing rate of TT (telegraphic transfer) charges may be enhanced from SAR 10/- to SAR 20/- for transactions between $100-200,” said a central bank notification issued.
Previously, the charges were paid on a transaction of a minimum amount of $200. Now, the minimum amount eligible to attract the transfer charges has been reduced to $100.
In another notification, the State Bank of Pakistan (SBP) has extended the incentive scheme for exchange companies to promote home remittances through formal channels.
Previously on December 06, 2019, SBP had introduced an incentive scheme in which exchange companies were allowed market expenses reimbursement of Re. 1 per each incremental US dollar mobilized over 15% growth.
In this regard, SBP has decided that the existing incentive scheme for the marketing of home remittances i.e. Rs. 1 against US Dollar 01 of remittance amount beyond 15% growth over last year may now be based on tiered growth i.e. Rs. 0.50 on 5% growth, Rs. 0.75 on 10% growth and Rs. 1.00 on 15% growth with immediate effect.