KARACHI: Rs13m home remittances sent through post office
By Bahzad Alam Khan
KARACHI, Dec 5: The Pakistan Post Office has distributed Rs13 million as home remittances - or the amount of foreign exchange sent back home by overseas Pakistanis - over the past one year through its 59 general post offices and head post offices in the country, officials said here on Thursday.
They added that the PPO had signed an agreement with Habib Bank, with permission from the State Bank of Pakistan, on July 14, 2001 under the Companies Ordinance 1984. The agreement had come into force on Aug 1, 2001. They said another agreement had been signed with Western Union Bank.
Under the Habib Bank agreement, the foreign remittances booked by the bank will be paid by post offices in the Pakistani rupee through money order services (both ordinary and fax).
PPO sources told Dawn that through ordinary money order service remittances would be delivered in at most two days. Remittances sent through fax money order would be delivered within 24 hours (same day).
The agreement says: “In consideration of the Pakistan Post Office providing the remittance services Habib Bank shall pay charges/commission in case the remittance is desired through ordinary money orders at the rates as mutually agreed.”
The sources said for a Rs5,000 ordinary money order, the PPO would charge Rs20; for a Rs10,000 money order, Rs30; for a Rs15,000 money order, Rs40; for a Rs30,000 money order, Rs50; for a Rs50,000 money order, Rs60; and for a Rs100,000 money order, Rs75.
They added that for the fax money order in zone I, the PPO would charge Rs25; in zone II, Rs30; in zone III, Rs35 and in zone IV, Rs40.
Under the terms stipulated in the agreement, the PPO will ensure payment of money orders within 48 hours in case of disbursement in the same city, 72 hours in big cities/towns and 96 hours at all other places.
The PPO sources told Dawn that the agreement with Western Union Bank had enabled the postal department to distribute home remittances worth Rs12 million alone.
A senior banker said after the Sept 11 terrorist attacks in the US, governments all over the world had started placing curbs on illegal banking channels - known as the Hundi system in Pakistan and the Havala system in India - which had allegedly been employed to send money to those responsible for the attacks. “Many Hundi/Havala centres all over the world, especially in the UAE, were raided. As a result, people, particularly the overseas Pakistanis, began to feel that their money might get stuck up if they sent it home through non-banking channels. Little wonder, then, that the home remittances have gone up since Sept 11.”
Analysts say previously people preferred Hundi/Havala system to banking channels for two reasons. First, the difference between inter-bank rates of the dollar and the open-market rates was large enough to make people opt for non- banking channels. Secondly, the banks were not prompt enough to deliver the home remittances to people. “While the operators of the Hundi system could deliver the home remittances the same day, the banks used to take at least a week to do so,” they explain.
They add that in an attempt to eliminate the Hundi system the government has significantly lowered the difference between the inter-bank rates of the dollar and those of the open-market.
A senior official of the HBL said the PPO had been engaged to deliver the home remittances because it was easier for the PPO to reach people in rural areas.
Banking experts said money sent back home from Pakistanis living in the United States now accounted for more than 30% of the total home remittances.
