SBP reserves rise by $4m, rupee gains against dollar
KARACHI: Foreign exchange reserves of the State Bank of Pakistan (SBP) increased by $4 million during a week, while the PKR appreciated against the US dollar, reflecting a positive sign of stability for the exchange rate.
The SBP reported on Thursday that the reserves of the central bank reached $8.021 billion with the addition of $4m during the week ended on March 22, 2024.
The SBP did not mention the source of inflow in its account, but the dealers in the interbank market said the central bank has been buying dollars from the banking market.
The reserves of the country reached $13.427bn during the same week, with $5.405bn held by commercial banks.
On the other hand, the rupee kept appreciating against the dollar and reached at Rs278.03 on Thursday in the interbank market. This was a source of concern for market experts that despite poor reserves of dollars and a wide trade deficit, how long the exchange rate will remain stable.
The government is engaged with the International Monetary Fund (IMF) for the release of $1.1bn as the last tranche of $3bn Stand-by Arrangement. This expected inflow will increase the reserves of the SBP, but the $1bn outflow for maturity of Euro bonds in April will again pull down the SBP reserves.
The new finance minister has yet to come out with any strategy to deal with the rising foreign debts and debt servicing, which is the main reason for the current account deficit. The estimated debt servicing for FY25 is about $25bn. This will again keep the government busy arranging dollars and selling the country’s assets to raise dollars.
CBC on ASAAN accounts
The SBP has facilitated ASAAN Mobile Accounts (AMAs) customers by waiver of Call Bank Confirmation for a temporary period.
“It has been decided that banks/ MFBs shall conduct “Call Back Confirmation (CBC)” on ASAAN Mobile Accounts (AMAs) within 30 days from their opening, instead of performing biometric verification within 60 days from the opening of AMAs,” said a circular issued by the SBP on Thursday.
This will facilitate AMA customers, especially women, to continue availing financial services through a seamless digital process, the circular added.
The SBP has been making efforts to increase the maximum inclusion of customers in banking services. Several steps were taken to bring the unbanked into the banking services.
“Banks and MFBs are advised to conduct CBC of all AMA customers whose accounts have been opened after the lapse of the subject temporary waiver on May 10, 2023, and have not been biometrically verified,” said the circular.
Extended banking hours
The SBP on Thursday announced that banks would observe extended banking hours on Saturday and would remain open on Sunday to facilitate the taxpayers in payment of government duties and taxes.
In a statement, the SBP said that branches of all banks that are open on Saturday would observe extended banking hours till 4:00pm on Saturday and Sunday for collection of taxes through Alternate Delivery Channels (ADCs) Over-the-Counter facilities.
To ensure same-day clearing or settlement of payment instruments, the National Institutional Facilitation Technologies (NIFT)has been advised to arrange special clearings at 4:00pm on Saturday (March 30) and Sunday (March 31).
To eliminate the issue of spillover of tax receipts, banks would ensure that no instrument concerning government receipts, lodged during the aforementioned office hours, remains unattended at branch counters and must be lodged in the aforesaid special clearing in the value date of March 31.
Moreover, banks were advised to keep their branches open on March 30 and 31 till such time that is necessary to facilitate the special clearings for government transactions by the NIFT.
Published in Dawn, March 29th, 2024