Bank accounts compulsory for Pakistani expats to remit money
In 2017, Pakistani expats remitted a whopping USD 19.3 billion back to Pakistan with USD 9 billion coming from Saudi Arabia and the UAE alone. More than 8 million Pakistanis live abroad and remittances make up 6% of Pakistan’s GDP. The Pakistani government are looking to make it mandatory for Pakistani expats to have a bank account in Pakistan in order to send remittances.
A move towards safer transactions
This proposal by the Pakistani government is to ensure that there are smooth money transactions through legal banking channels and to try and prevent money laundering. It will also help overseas workers remit money in the fastest possible time.
This should be incredibly helpful for Pakistani expats because if your remittances are delayed, you can even demand compensation from the banks as they are now liable for the transfers. This is why the Pakistani government is encouraging both banks and money exchange houses to upgrade their systems so that the transfers can happen in the fastest possible time.
Incentives for Pakistani expats
The banks are looking to give incentives to account holders for using legal channels to send remittances. At the moment the government is saying that one of these incentives is that expats will not face any inquiries for their assets back home if they are bought with legally transferred money. The Pakistani government have already started inquiries against people living beyond their means and have asked them to provide proof of the sources of their assets.
Currently more than 250 million migrants from across the world remit more than USD 500 billion a year back to their home countries. Therefore, making sure these transactions are legal is an important issue that needs to be addressed.