Remittances hit record high at $20bn, stay above $2bn for 21st month in a row

• Remittances rise 7.6% to $20.14bn during July-February.
• SBP notes that remittances have remained above $2bn since June 2020.
• Inflows rise 2% month-on-month to $2.19 billion in February 2022.

KARACHI: Pakistan has received record-high workers’ remittances of $20.1 billion from the expatriates in the first eight months (July-February) of the current fiscal year 2021-22, and stayed above $2 billion for the 21st consecutive month.

Remittances rose 7.6% to $20.14 billion during July-February of the fiscal year 2021-22 compared to $18.71 billion in the same period of 2020-21, the State Bank of Pakistan (SBP) reported on Thursday.

The inflows rose 2% month-on-month to $2.19 billion in February 2022. They had amounted to $2.14 billion in the previous month of January 2021. They slowed down 2.7% in February compared to $2.25 billion in the same month of last year.

With $2.2 billion of inflows during February 2022, workers' remittances continued their strong performance and have remained above $2 billion since June 2020, the central bank said in a statement issued in this regard.

“In terms of growth, during February 2022, remittances increased by 2% on a month-on-month basis despite fewer working days compared to January,” the statement read.

Remittances started improving after global travel came to a standstill during the peak of COVID-19. That development also disrupted the network of illegal Hawala/ Hundi operators, who used to offer a better price to the remittance senders compared to the one offered by the official channels like banks.

Accordingly, the remittance inflows started improving from June 2020 and came in at a historic high of $2.78 billion in September 2021.

Alpha Beta Core CEO Khurram Schehzad in his analysis said that with remittances clocking in at $2.2 billion, “seems like current account deficit for February 2022 would be slightly below $1 billion.”

The central bank said that remittances inflows during February 2022 were mainly sourced from Saudi Arabia ($558 million), the United Arab Emirates ($387 million), the United Kingdom ($319 million) and the United States of America ($210 million).