KARACHI: Inflows under Roshan Digital Accounts (RDAs) — a banking facility reserved for non-resident Pakistanis — amounted to $222 million in January, down nine per cent from the preceding month.

On a year-on-year basis, however, the increase in monthly RDA inflows was almost 38pc, data issued by the State Bank of Pakistan (SBP) showed on Monday.

“RDA flows continue at a decent pace, but a slowdown is evident,” said Fahad Rauf, head of research at Ismail Iqbal Securities. “The [pace of the] number of new accounts opened is also slowing down,” he added.

As many as 342,611 new RDA accounts were opened in January, up 6.2pc from the preceding month.

Mr Rauf said the central bank is also considering an increase in the profit rates offered on Naya Pakistan Certificates (NPC) — a move that can boost RDA flows.

Month-on-month deposits fall 9pc to $222m

NPCs are dollar, rupee, euro and pound–denominated sovereign instruments available in both conventional and Shariah-compliant forms. The returns are highly lucrative compared with similar bonds offered elsewhere. For example, the dollar-based return on the 12-month instrument is as high as 6.5pc.

From September 2020 when the RDAs were introduced to the end of January, total funds received through these accounts amounted to $3.38 billion. About 69pc of these funds were parked in NPCs. It means total investments in NPCs equalled $2.32bn between September 2020 and January.

Within NPCs, conventional bonds attracted $1.28bn while Islamic instruments pulled in $1.04bn. Stocks received $34m flows over the same period.

Meanwhile, a press release on Monday quoted SBP Governor Dr Reza Baqir as saying that RDAs have been “a great success” among overseas Pakistanis, especially those living in Saudi Arabia.

Addressing an interactive session organised by the Embassy of Pakistan in Riyadh, Dr Baqir said Pakistanis based in Saudi Arabia have opened the highest number of RDAs and sent the second-highest amount of deposits out of 175 countries. Overseas Pakistanis can open bank accounts in Pakistan and meet their saving and investment needs through a fully digital process, it said.

SBP Executive Director Arshad Mehmood Bhatti gave a detailed presentation on RDAs and their allied products, including NPCs, Roshan Apni Car, Roshan Samaaji Khidmat and Roshan Apna Ghar, which offers overseas Pakistanis “a very convenient means” of buying property in Pakistan through bank financing or their own funds.

Published in Dawn, February 8th, 2022