Banks start making swift transfer of remittance by overseas Pakistanis

KARACHI: In a bid to increase the flow of remittances, the State Bank of Pakistan (SBP) on Saturday said under a new payment mechanism banks will inform one another other on a daily basis about the accounts to be credited with remittances received from abroad.

It said the funds shall route through the Real Time Gross Settlement (RTGS) system simultaneously with the exchange of information.

“New mechanism will address the issue of delay in inter-bank settlement of remittance transactions,” it said, adding five major commercial banks have begun transferring remittances into beneficiaries’ accounts the same day under the system.

Allied Bank, Habib Bank, MCB Bank, National Bank and United Bank have joined the mechanism in the first phase “On the first day of its functioning, these banks credited Rs100 million into beneficiaries’ accounts on the same day under the new mechanism.”

The SBP is now trying to bring more banks into this fast-track payment mechanism. The goal is to integrate all the banks into the payment network for smooth flow of remittances, it said.

The new payment mechanism facilitates banks in immediate transfer of funds through RTGS which makes remittance funds immediately available to the participating banks so that they can credit remitted amounts to beneficiary accounts.

These efforts are part of the Pakistan Remittance Initiative (PRI), a joint programme of the SBP and ministries of finance and overseas Pakistanis to bring remittance transfer into the formal bank system. The News

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