SBP introduces foreign currency account for NRPs

KARACHI: The State Bank of Pakistan (SBP) has allowed business entities formed overseas with a majority shareholding of non-resident Pakistanis (NRPs) to open foreign currency and rupee accounts.

The central bank has decided to introduce two separate categories of foreign currency and Pak rupee accounts namely Foreign Currency Business Value Account (FCBVA) and Non-Resident Rupee Business Value Account (NRBVA) to help businesses incorporated abroad with a majority shareholding of NRPs, it said in a circular on Tuesday.

Banks may open NRBVA of the legal entities incorporated or registered abroad and the majority (51 percent or more) are owned and/or controlled by NRPs and/or non-resident Pakistan Origin Card (POC) holders, the SBP said.

The entities could be companies, associations, foundations, limited liability partnerships, societies, trusts, Waqfs, and /or other similar legal arrangements. However, it would not include sole proprietorships or unregistered partnerships, it added.

“Banks or the authorised dealers (ADs) may allow operations in NRBVA through electronic channels besides conventional modes in practice,” the circular said.

“ADs may also issue cheque books, if required by the authorised account operators. In case these accounts become dormant due to non-operation, ADs shall devise a mechanism, aligned with applicable regulations, to reactivate the account digitally,” it added.

The NRBVA holders could receive remittances from abroad through banking channels. They can also transfer funds from their own foreign currency business value account with the same bank.

The credits to the foreign currency business value account can be made through remittances received from abroad through banking channels, transfer of funds from its own NRBVA maintained in the rupee with the same banks, and profit, mark-up, return or proceeds of sale or maturity of permissible investments made from these accounts.