SBP tells banks to accept all types of dollars

The State Bank of Pakistan (SBP) Monday advised banks and exchange companies to accept all types of dollars. Syed Irfan Ali Shah, Executive Director Exchange Policy Department, SBP conducted a meeting of the representatives of commercial banks and exchange companies to discuss certain issues related to exchange market as the SBP received complaints that some banks were not accepting old or stapled dollar currency notes. The meeting was also attended by Malik Muhammad Bostan, President, Forex Association of Pakistan (FAP) and Zafar Paracha, General Secretary, Exchange Companies Association of Pakistan (ECAP).
Syed Irfan Ali strictly asked exchange companies and banks for acceptance of all types of dollars. He said the SBP is closely monitoring the exchange market and has observed that banks and exchange companies are not accepting small denomination, old or stapled dollar notes, that has created panic in the market. Sometime banks and exchange companies accept these dollars but at lower rates, he added.
"This is not possible for the SBP to maintain multiple exchange rates, therefore banks and exchange companies should accepts all types of dollars," he said. He also assured that a comprehensive policy on the issue will be developed soon. Malik Muhammad Bostan told the meeting that commercial banks are even not depositing small denomination, old or stapled dollars into the accounts of depositors.
He said exchange companies mainly export these dollars to Dubai resulting in one to three percent loss on exchange of these dollar notes. Therefore, the companies are accepting small denomination, old or stapled dollars at lower exchange rate, while banks categorically reject these greenbacks. Bostan appreciated the SBP's efforts for making the exchange market stronger by taking positive measures.