KARACHI: The State Bank of Pakistan (SBP) has allowed banks to open foreign currency accounts of a non-resident and a resident Pakistani who have duly declared assets held overseas, it said Thursday.
“Authorized merchants (banks) will process transactions on the account through the digital channels, e.g. Internet/mobile banking, ATMs/debit cards,” the SBP said in a statement.
“The ADs can also issue a checkbook to the account holder if needed.”
The SBP introduced a separate category of foreign currency accounts to support non-resident and resident Pakistanis who have assets abroad that are duly registered with the Federal Board of Revenue (FBR) for investment in foreign currency-denominated government-registered debt securities base have been declared.
“The resident person wishing to open an FCVA must provide the declaration of their assets held overseas, including the most recent wealth tax return filed with the FBR,” it said.
“ADs are encouraged to provide real-time online FCY to PKR conversion based on the account holder’s request made digitally for the allowable withdrawals from the account. For the sake of transparency, the ADs indicate the exchange rate applicable to the transaction.”
The SBP said ADs would develop a mechanism, aligned with applicable regulations, to digitally reactivate the account in the case of a non-resident account where the account is dormant due to non-operation.
“However, for resident FCVA (Foreign Currency Value Account), ADs may reactivate the account digitally or otherwise in accordance with applicable regulations and their own policy,” it said.
“Banks will ensure ongoing monitoring of these accounts to mitigate money laundering and terrorist financing risks.” SBP has revised foreign exchange regulations to simplify existing instructions, adopt international practices and eliminate redundancies.
The non-resident rupee account with repatriation rights can be opened by the non-resident rupee account and non-resident rupee account with repatriation facility.
These accounts could be opened by the banks without the prior consent of the SBP. Banks should follow their standard procedures for opening and maintaining such accounts and ensure compliance with all applicable anti-money laundering and anti-terrorist financing policies, including identifying the ultimate beneficial owner and purpose of the account.