KARACHI: The State Bank of Pakistan (SBP) has reduced the retention period of export proceeds with Authorized Dealers upon realization from five days to three working days.
The SBP Monday modified some instructions related to export proceeds mentioned in Para 7 and 35, Chapter 12 of Foreign Exchange (FE) Manual.
Previously, as per Para 7, Chapter 12 on retention period of export proceeds with Authorized Dealers upon realization, it was permissible for exporters to retain the export proceeds including 'Advance Payments' in foreign currency with an Authorized Dealer in Pakistan for five working days of receipt of funds by Authorized Dealer (value date of Nostro Account) and to sell the same within this period to any Authorized Dealer.
However, now this period has been reduced to 3-days from 5- working days. Accordingly, the first sentence of Para 7 Chapter 12 of FE Manual has been replaced. As per fresh amendment, "it is permissible for exporters to retain the export proceeds including 'Advance Payments' in foreign currency with an Authorized Dealer in Pakistan for three working days of receipt of funds by Authorized Dealer (value date of Nostro Account) and to sell the same within this period to any Authorized Dealer."
SBP amends foreign exchange regulations to facilitate exports
In addition, SBP has asked the Authorized Dealers to report the receiving of full export proceeds in three working days. Accordingly, the SBP has also modified the Sub-para (ii) (c) of para 35 of Chapter 12relate to Remittance of Export Commission, Brokerage & Discount and Retention of Export Proceeds in Exporters Special Foreign Currency Account.
According to modified para "By remittances from Pakistan, when the full export proceeds are received, within three working days of the receipt of funds by Authorized Dealer (value date of Nostro Account). The Authorized Dealers should report the full export proceeds of the bill as "Purchase" and the amount of commission remitted should be reported as "Sale"."
The SBP said that all other instructions on the subject will remain unchanged. Authorized Dealers are advised by the SBP to bring these amendments to the notice of all their constituents for meticulous compliance. Industry sources said that this measure will also help to increase the dollar flow in the interbank market and help to stable the exchange rate.
Copyright Business Recorder, 2021
Comments
Comments are closed for this article.