KARACHI: For facilitating genuine buyers, the State Bank of Pakistan (SBP) on Saturday temporarily allowed the exchange companies to sell over $500 to individuals on production of biometric certification from the National Database and Registration Authority’s e-Sahulat outlets.
The SBP had directed the exchange companies through a circular dated Oct 7 to conduct mandatory biometric verification from Oct 22 for all foreign currency sale transactions equivalent to $500 and above and outward remittances. However, the biometric verification requirement could not be implemented since the system to connect with Nadra was not available.
The central bank took this decision to stop dollar outflow particularly to Afghanistan following a sharp increase in demand which destabilised the exchange rate in the open market amid media reports that millions of dollars were being smuggled out to Kabul particularly after the change of regime.
“The State Bank of Pakistan has allowed us to sell dollars with biometric certification from Nadra’s e-Sahulat franchises up to Nov 5,” Exchange Companies Association of Pakistan (ECAP) Secretary General Zafar Paracha told Dawn.
The Oct 22 SBP circular said the exchange companies — both A and B categories — may conduct the sale of foreign currency and outward remittances as per limits prescribed in the previous circular issued on Oct 7 on the biometric verification receipt in original generated through the Nadra e-Sahulat services up to Nov 5.
However, the exchange companies will verify the genuineness of system-generated receipts from the website of Nadra e-Sahulat and keep the copies of verification along with other required documents.
“After Nov 5, the exchange companies (A and B) will use the android-based application developed by Nadra for biometric verification,” said the circular.
Mr Paracha said the dollar selling on Saturday was higher than the previous days since the genuine buyers could not get their required amount on Friday. “Since Britain has resumed flights from Pakistan, hundreds of students are in need of dollars for education purposes,” he added.
“The SBP decision will help the market since the people who really need dollars will not go towards the black market,” said ECAP chairman Malik Bostan.
He also expects that dollar purchasing in the open market would go higher with the opening for students to fly Britain. However, he said the overall situation for trading in the open market is cool as most of the clients are sellers and only 10 per cent are buyers.
“The sellers don’t need to go through the biometric procedure. The country doesn’t restrict inflow of dollars,” he added.
The SBP has issued fresh instructions by restricting each person travelling to Afghanistan to carry maximum $1,000 per visit with the annual limit of $6,000. It has also revised Prudential Regulations for Consumer Financing for moderating demand growth in the economy, leading to slower import growth and thus supporting the balance-of-payments.
Published in Dawn, October 24th, 2021