KARACHI: In order to facilitate IT companies and freelancers, the State Bank of Pakistan (SBP) has extended mandatory retention of 35 percent of their export proceeds in special foreign currency accounts by June 30, 2023.

State Bank on Jan 13, 2023 amended foreign exchange regulations and allowed the IT exporters and companies to retain 35 percent of their export proceeds in special foreign currency accounts.

Accordingly, banks were advised to mandatorily credit 35 percent of the exports proceeds of IT companies and freelancers into these exporters’ special foreign currency account.

35pc retention of remittances in FCY accounts: SBP to coordinate to help resolve banking matters

However, such exporters are required to register either with Pakistan Software Export Board (PSEB) or Pakistan Software Houses Association (P@SHA), and be involved in the export of Software, Information Technology (IT) services, IT Enabled Services (ITeS).

According to previous directives, this facility was valid until March 31, 2023, however, now the SBP has announced plans to extend this facility. SBP has decided that the validity of these instructions is hereby extended up to June 30, 2024.

Copyright Business Recorder, 2023