Annual remittances likely to reach $17bln

KARACHI: Remittance flows will sustain their upward momentum to surpass the government’s target for the current fiscal year 2014/15 due to increasing penetration of Pakistani banks in the remittance markets of different regions, National Bank of Pakistan (NBP) Senior Executive Vice President Khalid Bin Shaheen said on Tuesday.
“Remittance flows are expected to reach $17 billion during FY15, higher than the government’s target of $16.7 billion and from $15.8 billion in FY14,” he said.
Pakistan received an amount of $14.97 billion in remittances during July-April FY15.
Speaking at a news conference held at the NBP premises, Shaheen said that global economic recovery and rising network of local banks in traditional remittance markets of the Middle East, GCC, USA and UK continue to spur growth in foreign remittances.
He said that under Pakistan Remittances Initiative (PRI) scheme, an increasing number of overseas Pakistanis are sending cash through formal banking channels.
Shaheen said that efforts are being made to reduce the cost and time for sending remittances, including removing barriers and impediments in the remittance market.
“Expanding network in the US, UK, GCC and Far East, Global Home Remittances Management Group of NBP has recently signed home remittance agreement with US-based Transfast Remittance LLC, Belhasa Global Exchange UAE, and Al-Muzaini Exchange Company Kuwait bringing the total number of tie-ups from 13 in 2009 to 36 in 2015,” Shaheen said.
“This collaboration will further boost the remittance business and will give a choice to remitters to send their money to their loved ones not only from Gulf countries like UAE and Kuwait, but also from the US and Canada,” he said
“All three companies are considered to be leading players in their respective jurisdictions and will help NBP to extend its reach over a large number of countries by utilising their large customer base, state of the art technology, and professionally qualified and experienced management,” he added.
He revealed that people still prefer to use hundi / hawala, as the system provides convenience to them in the shape of door-to-door delivery, reliability (especially in the rural market) and accessibility even in far flung areas with no bank branch for miles around.
“Secondly, the exchange rate offered by the banks is less favourable than that offered in the open market, which constitutes an added attraction for both the sender and the recipient. But, in pursuit of the national cause, NBP is providing free of charge services, which is fast, convenient, secure, and reliable.”
NBP’s remittance portfolio currently stands at over Rs160 billion per annum. During the last five years, the NBP has demonstrated remarkable turnaround in home remittances business in terms of transactions, volume, revenue, tie-ups and innovation.
The key destinations in Pakistan are Sialkot, Gujranwala, Mardan, Gujrat, and Rawalpindi, he informed.