KARACHI, Feb 13: The State Bank has allowed banks to issue foreign currency travellers cheques to Pakistanis as well as foreign nationals provided they surrender equivalent amount of foreign exchange in cash.

The SBP announced this decision through a circular F.E. 03 issued to all banks on Wednesday.

The central bank had put restrictions on issuance of foreign currency travellers cheques against surrendering of foreign currency in cash in October 1999. The purpose was to ensure that the facility is not misused for capital outflow. Central bankers say the restriction has been lifted in line with the ongoing liberalization of foreign exchange regime on the insistence of the IMF.

Recently the SBP also lifted restrictions on the release of foreign exchange to those travelling abroad for any purpose.