SBP amends FX transaction rules

KARACHI: The State Bank of Pakistan (SBP) has amended rules for foreign exchange transactions, aiming to strengthen regulatory regime for exchange companies and encourage customers to use banking channels for purchase of foreign currency from the currency exchangers.

In a statement on Friday, SBP advised exchange company to conduct all foreign currency sale transactions of US $2,000/ or above (equivalent in other currencies) only through payment modes such as bank transfer/cheques from the personal account of a customer.

The initiative would help further enhance transparency and promote documentation in foreign exchange (FX) transactions, SBP said.

The transaction/instrument reference number and name of the bank transferring funds/ issuing the instrument has to be mentioned on the transaction receipt along with the identification document number of a customer.

The step was focused on encouraging the general public to use various banking channels, which are generally more secure, to fulfill their genuine foreign exchange needs, the central bank said.

Zafar Paracha, secretary general of the Exchange Companies Association of Pakistan applauded the decision saying they would observe whether the action assist stop the rupee decline.