KARACHI, June 19: The State Bank of Pakistan (SBP) has so far issued No Objection Certificates (NOCs) to nine mini exchange companies or exchange companies in category B.

The companies are: Money Masters Currency Exchange Co; Sky Exchange Co; World Wide Exchange Co; Overseas Exchange Co; Rajgan Exchange Co; Great Union Exchange Co; United Exchange Co; Premier Exchange Co; and Union Exchange Co.

The SBP said in a statement issued here on Saturday that after incorporation of these companies with the Securities & Exchange Commission of Pakistan (SECP) it would issue final licences to them to start operations.

The central bank said that 56 existing money changers had sponsored these nine companies adding that more than 80 money changers had so far applied for setting up mini exchange companies.

The SBP once again warned that "all money changers who are currently authorized to transact exchange business would cease to function beyond June 30, 2004 on expiry of their licences."

The money changing business, in addition to banks, would be transacted through exchange companies (both mainstream exchange companies and mini exchange companies or exchange companies in B category).

The central bank have so far issued 16 licences for setting up mainstream exchange companies 12 of which have already started operations.

Those who have started operations are: H& H Exchange Co.; NBP Exchange Co.; Khanani & Kalia International; Al-Sahara Exchange Co.; Data Exchange Co.; Glaxy Exchange Co.; Dollar East Exchange Co; Eastern Union Exchange Co.; Zarco Exchange Co.; Wall Street Exchange Co.; PICIC Exchange Co.; and Pakistan Currency Exchange Co.

Whereas mainstream exchange companies have been set up with a minimum paid-up capital of Rs100 million, mini exchange companies are being set up with a minimum capital of Rs20 million.

But unlike mainstream exchange companies, mini exchange companies cannot make outward or inward transfer of foreign exchange electronically. They can only buy and sell foreign currency notes and coins in cash.

Apart from setting up their own mini exchange companies, the existing licensed money changers are also allowed to get franchise with the mainstream exchange companies.

Chief Executive of H&H Exchange Co. said that 25 money changers had applied for seeking franchise with his company and had surrendered their licences for this purpose.

"We may give them franchise after seeking NOC from the State Bank within a couple of days," he said when reached by Dawn over telephone.