AMF, SBP sign MoU to facilitate cross-border remittances

KARACHI: The Arab Monetary Fund (AMF) and State Bank of Pakistan (SBP) have signed an MoU to facilitate cross-border remittances between the Arab region and Pakistan through formal channels, a statement said on Friday.

Director General and Chairman of the Board of AMF Dr Abdulrahman Bin Abdullah Al Hamidy and Governor SBP Jameel Ahmad signed the MoU in Abu Dhabi.

The MoU is signed to establish a framework of cooperation between Buna, the cross-border payment system operated by the Arab Regional Payments Clearing and Settlement Organization ARPCSO, owned by AMF, and Raast, Pakistan’s instant payment system.

“The integration of Raast with Buna aims to facilitate cross-border remittances between the Arab region and Pakistan through formal channels,” the SBP said in a statement.

“This initiative will benefit individuals as well as businesses not only through instant, safe, and cost-effective cross-border payments, but also by strengthening economic, financial, and investment ties between the Arab countries and Pakistan.

“This strategic collaboration with Raast underscores Buna’s commitment to continue connecting different regions together and reinforcing economic, financial, and investment ties between the Arab region and its main global partners,” Al Hamidy said.

“This resonates with the shared vision of innovating cross-border payment solutions to offer safe and efficient cross-border instant payment access for individuals and corporates.

“We also aim to increase cross-border remittances by reducing costs and processing times; this initiative confirms the global character of Buna which adheres to the highest compliance standards to connect the Arab region with its main global partners in line with the vision of its founders, their excellencies in the Council of Central Bank Governors.”

Governor Ahmad said the collaboration between SBP and AMF was in line with the vision to leverage cross-border integrations to complement the objective of building an innovative digital financial services ecosystem.

“The integration of the two payment systems will increase remittances to Pakistan through formal channels, with enhanced speed, safety, and savings in these cross-border transactions. With over 5 million Pakistanis residing in the Arab region and around 55 percent of Pakistan’s total remittances received from Arab countries, the SBP is committed to completing the necessary work and operationalizing the connectivity between Raast and Buna in the shortest possible time.”

Buna aim to enable financial institutions and central banks in the Arab region and beyond to send and receive payments in local currencies as well as key international currencies in a safe, cost-effective, risk-controlled, and transparent environment. It offers the participants modern payment solutions that comply with international standards, principles and compliance requirements. SBP ‘Raast’ instant payment system is a transformational initiative that is built on the state-of-the-art international standard ISO 20022 and promises to be simple, free, fast, interoperable, and a secure payment option for customers.