SBP rejects allegations with respect to facilities provided to exporters

The State Bank of Pakistan (SBP) has rejected allegations made on a private channel with respect to its facilities provided to the exporters.

Terming it “baseless allegations’ SBP responded that since 2001, exporters of goods are allowed to retain up to 10pc of their realized export proceeds whereas for services and IT only this limit is 35 pc. This facility enables exporters to meet their promotional/marketing, discounts, commission, and other related expenses abroad.

SBP said that similar facilities are also available to exporters in other regional countries.

On-demand of stakeholders, SBP said that it prepared a policy proposal to broaden the permissible usages of foreign exchange held in Exporter’s FCY account whereby expenses related to office abroad, trade fairs, foreign consultants, foreign travel, warehousing, etc. are also allowed.

“This will facilitate our exporters to effectively compete with regional competitors in seeking export orders from the international market,” said SBP. The central bank informed that these accounts can only be opened by genuine exporters, fed with a prescribed portion of export proceeds and utilized for specified purposes only. Therefore, balances held in such accounts are not allowed to be utilized for any other purpose like the purchase of properties abroad.

Further, in terms of AML/CFT regulations and TBML framework issued by SBP, the central bank informed that all commercial banks are required to perform due diligence and ensure the genuineness of the purpose, parties, and documents involved in the transactions.