Saturday August 13, 2022

RDA inflows reach new high of $4.794bn in July

By Our Correspondent
August 06, 2022

KARACHI: Inflows from Roshan Digital Account (RDA) have reached $4.794 billion in July, 2022, the central bank data showed on Friday.

The foreign exchange inflows received under RDA had stood at $4.606 billion by the end of June.

In July, the total number accounts of non-resident Pakistanis (NRPs) from 175 countries reached 441,344, which were 429,364 at the end of June.

The State Bank of Pakistan (SBP) data also showed that from September 2020 to the end of July 2022, the total investment made via Naya Pakistan Certificates (NPCs) amounted to $3.089 billion, with $1.635 billion invested in the conventional NPCs and $1.454 billion in Islamic certificates. The NRPs invested $41 million in the stock market.

Rolled out in September 2020 to allow the NRPs access to the local financial market, the RDA initiative is gaining significant appeal from the overseas Pakistanis living across the globe, lending support to the country, which is facing a dollar liquidity crunch.

Pakistan’s foreign exchange reserves continued to decline on the back of delay in the International Monetary Fund (IMF) loan programme and a lack of external assistance from other bilateral and multilateral creditors.

The foreign reserves held by the State Bank of Pakistan declined by $190 million to $8.385 billion.

The SBP’s official, in a recent podcast, rejected criticism on RDA, saying the apprehension that there have been large outflows from the scheme was false, though it plans to expand product offerings under the initiative, he added.

There have been outflows, however, these were due to the maturity of investments in NPCs, which started in early 2021 and the repatriation of the funds was a key feature of RDA around which the product was designed to garner confidence in the public, said Ali Raza Syed, senior joint director at the SBP said in the podcast last week.

“Another reason for the outflows is an increase in inflation due to which people are accessing their savings to make ends meet. During the last 23 months only $800 million have been repatriated,” Syed said.

RDA has a legal cover under “Foreign Currency Deposit Protection Ordinance 2001” and the State Bank of Pakistan also firmly stands by their RDA initiative. It is here to stay, Syed added.

A consumer product, Roshan Apni Car, introduced under the scheme, has also been very successful wherein 1550 cars have been delivered with a total financing of R8 billion, he said.