Permission for bank accounts helps boost Afghan refugees’ businesses

Yousaf Ali, a 34-year trader, had been running his shop of carpets in Al-Asif Square in the Sohrab Goth area for the past 10 years. However, being of Afghani descent, he could not open a bank account due to which he faced severe problems in his trade.

“Without having a bank account, one cannot run a business in the country,” said Ali, whose parents had migrated from Afghanistan’s Laghman province in 1979 because of an insurgency there.

Naturally, Ali and all other refugees were jubilant after the federal government announced its decision to allow hundreds of thousands of registered Afghan refugees to open bank accounts in Pakistan.

Pakistan allowed registered Afghan refugees to open and maintain bank accounts in a surprise move in a bid to make them part of the formal economy as they have remained associated with different businesses and professions in the country for decades.

In late February this year, Prime Minister Imran Khan announced that he had asked the authorities concerned to allow the Afghan refugees to open bank accounts. “I have issued instructions today that Afghan refugees who are registered can open bank accounts, and from now onwards they can participate in the formal economy of the country,” the PM tweeted. “This should have been done a long time ago.”

Following the PM’s tweet, the State Bank of Pakistan (SBP) notified on February 28 that the Afghan refugees registered with the National Database and Registration Authority (Nadra) could open bank accounts through biometric verification. Accordingly, the biometric verification of Afghan refugees holding a proof of registration (PoR) card has been started by Nadra since February 26 over the existing established linkage of CNIC verification.

However, the Afghan refugees not having PoR cards are still not entitled to open their bank accounts because they are considered illegal undocumented immigrants.

Ali is one among hundreds of registered Afghan refugees who opened their bank accounts this month. “We – the Afghan refugees’ community – are thankful to Prime Minister Khan for allowing us to open back accounts,” said Ali as he spoke with The News. He said the move raised hopes that soon the refugees would be able to purchase properties and vehicles in their own names and get driving licences.

Afghan refugees in Pakistan have faced many obstacles in doing businesses in the country because of the prior ban on the use of official bank channels for transactions. The Afghan business owners in Pakistan had to use their local employees' names for banking purposes and avoided large transactions for their financial security.

Jalad Khan, another Afghan refugee who is doing business of paper recycling in the Gulistan-e-Jauhar area, said Afghan refugees across the city were involved in big businesses, including carpet weaving, paper and bottle recycling, construction, and cloths and garments’ trade.

“This decision was a demand of those who do businesses with Afghan refugees," Khan told The News. He added that it would enable the refugees to formally participate in the national economy.

Qaiser Khan Afridi, a spokesperson for the United Nations High Commissioner for Refugees (UNHCR) Pakistan, said Pakistan had generously hosted millions of Afghan refugees for decades and the country should be lauded for the decision to allow Afghan refugees to open bank accounts.

“This is indeed an important step in support of the Afghan refugees which will formally contribute and boost the local economy,” he said. Afridi said the opening of bank accounts would allow members of the extended families of refugees that were living abroad to send remittances through formal banking channels, which would help increase the foreign exchange reserves in Pakistan. He said the UNHCR would continue to closely work with the Pakistani government for the betterment of Afghan refugees.

Pakistan continues to host 1.4 million Afghan refugees. According to the UNHCR, some 4.4 million Afghan refugees have gone back to Afghanistan under the UNHCR-supported voluntary repatriation programme. A total of 63,000 Afghan refugees holding PoR cards are residing in Sindh alone, mostly in Karachi, said Afridi.