Minister says 2-3% cut in remittance costs could add $1 billion a year
Minister of State Bilal Bin Saqib said cutting remittance transaction costs by two to three percent could bring in an extra $1 billion annually. PVARA and the State Bank are working on ways to lower the costs.
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- Bilal Bin Saqib says a 2-3% cut in remittance costs could add $1 billion to the economy.
- PVARA and the State Bank have a joint working group on lowering costs.
- A pilot project for Gulf remittance corridors is being explored.
Minister of State Bilal Bin Saqib, who also chairs the Pakistan Virtual Assets Regulatory Authority (PVARA), said that reducing the cost of sending remittances could significantly boost financial inflows into the country. He made the remarks in an official statement.
According to Daily Times, he said cutting transaction costs by just two to three percent could bring an additional one billion dollars into the domestic economy every year. Daily Pakistan Urdu also reported the figure.
Foreign remittances are a primary source of foreign exchange reserves for Pakistan. Federal authorities are focusing on modernising cross-border payment channels to maximise inflows from overseas workers.
Mr Saqib said PVARA and the State Bank of Pakistan are working together through a joint working group to bring down transfer expenses. Geo News was cited as the source of this detail by Daily Pakistan Urdu.
Regulators are also looking at a pilot project for remittance corridors from Gulf countries. Daily Times reported that it aims to introduce digital settlement systems that reduce transfer charges for Pakistani expatriates in the Middle East.
The minister said commercial banks must cooperate on shared financial infrastructure, custody services and cyber security. He stressed that banks and regulators need to strengthen cybersecurity to protect digital financial networks.
Daily Times reported that authorities are drawing up mandatory security standards to protect financial transactions and users' personal data, and that banks are being urged to invest in cyber defence tools.
The proposed reforms are expected to encourage overseas Pakistanis to use official banking and digital channels instead of informal transfer systems. Authorities plan to monitor the Gulf pilot closely before expanding modern remittance models nationwide.
Why it matters
Overseas Pakistanis pay transfer fees each time they send money home, so lower costs and new digital channels would affect them directly. Remittances are also a primary source of the country's foreign exchange reserves.
