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SBP Modifies Foreign Exchange Sale Rules

Central bank says all sales of $2,000 or above (or equivalent in other currencies) shall be conducted through bank transfers, cheques from personal accounts of customers

by Staff Report

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The State Bank of Pakistan on Friday advised all foreign exchange companies in the country to conduct foreign currency sale transactions of $2,000 or above against the rupee through payment modes such as bank transfers and cheques from personal bank accounts of customers.

In a brief statement, the central bank said the measure was aimed at enhancing transparency and promoting documentation in foreign exchange transactions. “This step is also focused on encouraging the general public to use various banking channels, which are generally more secure, to fulfil their genuine foreign exchange needs,” it added.

The transaction/instrument reference number and the name of the bank transferring funds/issuing the instrument shall be mentioned on the transaction receipt along with identification document number of the customer, said the SBP, warning that failure to comply with these instructions would attract regulatory action under the relevant provisions of the Foreign Exchange Regulation Act, 1947.

There has been growing criticism about the central bank’s inability to control the national currency’s slide against the U.S. dollar, with economic experts warning the current decline—ongoing for nearly two weeks—risks further inflation for consumers, and could also have an impact on the country’s foreign exchange reserves and debt liabilities.

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