Incentives to increase remittances

The State Bank of Pakistan (SBP) has enhanced incentives for banks and exchange companies to increase home remittances which have been declining for more than a year. The central bank on Thursday issued two circulars for banks and exchange companies. “For any incremental home remittance of the financial institution (FI) up to five per cent, between five and 10pc, and over 10pc, the cash incentive would be Re1, Rs2 and Rs3 per US dollar, respectively, for each slab,” said the SBP. These incentives are also available for exchange companies. The SBP said that to encourage domestic FIs to enhance their marketing efforts for mobilising home remittances through formal channels, the government has approved the revisions in the scheme. A performance-based incentive will be granted, by the end of FY24, to those FIs whose home remittance mobilisation efforts result in growth. The scheme will be effective from FY24 onwards on a perpetual basis.