KARACHI, Jan 23: State-run National Bank and the Middle East & Pakistan chapter of US-based Western Union have signed a deal to facilitate expatriate Pakistanis to make transfer of money from abroad “within minutes.”
NBP President Syed Ali Raza and Regional Director of Western Union Jean Claude Farah signed the agreement here on Thursday. State Bank Governor Dr Ishrat Husain was also present.
Raza and his colleague R. A. Kaleemi informed the audience that NBP had first joined hands with Western Union in July 2002 and overseas Pakistanis have been using the Western Union outlets to send money back home since then. Kaleemi said now his bank has increased to 133 the number of the branches that handle remittances sent through WU outlets adding that by the year-end the number will rise to 500.
In response to a question, he said between July-December 2002 NBP had handled $120 million worth of home remittances (money sent back home by overseas Pakistanis) adding that 10 per cent of it came through WU outlets. He said the share of remittances coming through
WU outlets would increase with more branches handling such remittances.
Syed Ali Raza said NBP is striving to handle more remittances not only through its alliance with WU but also through NBP foreign exchange company that would start operations on or before February 15.
Replying a question, Farah said there is a schedule of charges that would apply on remittances but he did not give details. He told Dawn later on that his company would charge 35 dirhams for remittances worth upto $3000 coming from the Gulf region into Pakistan and $12 for remittances upto $26,000 from three states of the USA.
Farah also said that remittances upto $7500 could be made from both the Gulf region as well as from the US by simply filling out a form but for the remittances exceeding $7500 Western Union will investigate into the sources and purpose of inflow to check money laundering.
When Dawn pointed out that this might deprive Pakistan of high profile remittances seen after 9/11 and eventually defeat the very purpose of NBP-WU agreement of increasing remittances Farah said it will not. Citing an example, he said the questioning that the WU normally has to do in case of bulk remittances are not of the nature that may scare the remitters away.
Speaking on the occasion, SBP Governor once again made it clear that the money being sent by overseas Pakistanis was the property of Pakistan whether it is sent through banks or through money changers. He said this inflow may be classified as export of services and the buildup in forex reserves on the back of higher remittances should not be interpreted as artificial boosting of reserves through purchase of dollars by SBP. “These dollars have not come from heavens...this is hard earned money of Pakistanis.”
Dr Husain further said that if Pakistan can keep the momentum of higher inflow of remittances this would give the country a chance to lessen its dependence on the international financial institutions and get rid of their conditionalities. “That is very essential for achieving sovereignty in economic decision making.”
He advised Western Union to concentrate on remitters based in Saudi Arabia who, in the absence of a Pakistani bank there, are forced to send remittances through other means.