Remittances surge by 16.9% to $2.7b in September

• September was the 16th successive month in which receipts remained above the threshold of $2 billion.
• In the first quarter of the current fiscal year, remittances surged to an all-time high of $8.03 billion.
• SBP says altruistic transfers to Pakistan amid the pandemic and orderly foreign exchange market conditions lent support.

KARACHI: The inflow of workers’ remittances into Pakistan increased by 16.9% to $2.7 billion in September compared to $2.3 billion in the same month of the previous year.

This is the seventh time in the past 16 months when the inflows of remittances sent home by overseas Pakistanis remained around $2.7 billion. 

Moreover, September was the 16th successive month in which receipts remained above the threshold of $2 billion, the State Bank of Pakistan (SBP) reported on Friday.

The country saw robust growth in workers’ remittances in the wake of COVID-19, as restrictions related to international travelling to contain the disease encouraged overseas Pakistanis to send remittances through banking channels.

Previously, some non-resident Pakistanis used to send money through illegal channels of hundi-hawala operators, as they paid a comparatively better exchange rate in Pakistani rupee in the country.

On a month-on-month basis, the inflows recorded a nominal gain of 0.5% during the month under review compared to August 2021, the central bank reported.

Cumulatively, in the first quarter (July-September) of the current fiscal year, remittances surged to an all-time high of $8.03 billion with an increase of 12.5% compared to $5.45 billion received in FY20.

The workers’ remittances surged by a strong 27% to an all-time high of $29.4 billion in FY21, surpassing the previous record high of $23.1 billion received in FY20.

“Proactive policy measures by the government and SBP to incentivise the use of formal channels and curtailed cross-border travel in the face of COVID-19 have positively contributed towards the sustained improvement in remittance inflows since last year,” the SBP said.

It added that altruistic transfers to Pakistan amid the pandemic and orderly foreign exchange market conditions lent further support.

Country-wise remittances

Country-wise data reveals that inflows from the Kingdom of Saudi Arabia (KSA) increased by 3.78% to $691 million in September compared to the same month of last year. They improved 6% to $502 million from the United Arab Emirates (UAE).

Inflows surged 35.8% to $245 million from the United States of America (USA) while remittances grew 27.96% to $370.2 million from the United Kingdom (UK).

Moreover, remittances from other GCC countries increased 13.9% to $297.7 million and a 44.28% increase was recorded in inflows from European countries, which clocked in at $299.1 million in the month under review compared to the same month of last year.