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Pakistan receives record $2 billion through Roshan Digital Accounts

Sep 8, 2009
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The Roshan Digital Account (RDA) programme has crossed a major milestone and hit the $2 billion mark as overseas Pakistanis continued to pose trust in the central bank initiative that was launched in September last year.


Overseas Pakistanis invested record $2 billion in various products offered by the RDA platform and it will continue to attract more inflows as the central bank is keen to add more investment options for non-resident Pakistanis, experts say.

“As Pakistanis all over the world celebrated country’s Independence Day, #RoshanDigitalAccount crosses the historical milestone of $2bn in deposits. A big thanks to Overseas Pakistanis for their overwhelming response to the RDA initiative,” State Bank of Pakistan (SBP), the central bank, tweeted.


Imran Khan inaugurated the RDA service on September 10, 2020 for non-resident Pakistanis to enable them to remotely open bank accounts in Pakistan through online digital portals without physically visiting branches. It is a joint effort of the SBP and the federal government in collaboration with eight commercial banks operating in Pakistan. Later, more banks joined the initiative to facilitate the overseas Pakistani community.

The inflow through Roshan Digital Account reached $1.87 billion at the end of July, with the first month of the current fiscal year witnessing the second highest inflow since the RDA was launched in September last year.

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Samiullah Tariq, head of research at Pakistan Kuwait Investment Company, said RDA is a huge success as overseas Pakistanis gave overwhelming response to the central bank initiative.

“The central bank is expected to receive record $3.5 billion inflows through RDA by December. More products are likely to attract overseas Pakistanis to invest in RDA products that will benefit the national economy,” Tariq told Khaleej Times on Sunday.

Last month, SBP Governor Dr Reza Baqir said the RDA initiative for overseas Pakistanis had generated new financial inflows of $1.8 billion which helped boost the country’s foreign exchange reserves. He said that Pakistan’s reserve buffers are expected to rise by another $2.8 billion in August through the IMF’s planned new global SDR allocation.

Banking experts and analysts were optimistic about the outlook of Roshan Digital Account and said it would continue to attract funds from overseas Pakistanis, especially those based in the Gulf region.
 

Wood

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Are these Roshan accounts denominated in foreign currencies? If yes, then the high interest rate could be a liability for Pakistani economy. This seems to be a high risk bet on the government in their ability to offset the high interest rate by a higher economic growth rate in future.
 

TacOps

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Are these Roshan accounts denominated in foreign currencies? If yes, then the high interest rate could be a liability for Pakistani economy. This seems to be a high risk bet on the government in their ability to offset the high interest rate by a higher economic growth rate in future.
Pakistan already pays 5% or above on sukuks and other liabilities. Though they are longer dated. I think NPC could have been priced 50 bps lower. The government is betting that it won't be hot money and the beahvioural maturity would be several years.
 

Vanamali

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The Roshan Digital Account (RDA) programme has crossed a major milestone and hit the $2 billion mark as overseas Pakistanis continued to pose trust in the central bank initiative that was launched in September last year.


Overseas Pakistanis invested record $2 billion in various products offered by the RDA platform and it will continue to attract more inflows as the central bank is keen to add more investment options for non-resident Pakistanis, experts say.

“As Pakistanis all over the world celebrated country’s Independence Day, #RoshanDigitalAccount crosses the historical milestone of $2bn in deposits. A big thanks to Overseas Pakistanis for their overwhelming response to the RDA initiative,” State Bank of Pakistan (SBP), the central bank, tweeted.


Imran Khan inaugurated the RDA service on September 10, 2020 for non-resident Pakistanis to enable them to remotely open bank accounts in Pakistan through online digital portals without physically visiting branches. It is a joint effort of the SBP and the federal government in collaboration with eight commercial banks operating in Pakistan. Later, more banks joined the initiative to facilitate the overseas Pakistani community.

The inflow through Roshan Digital Account reached $1.87 billion at the end of July, with the first month of the current fiscal year witnessing the second highest inflow since the RDA was launched in September last year.

View attachment 777407

Samiullah Tariq, head of research at Pakistan Kuwait Investment Company, said RDA is a huge success as overseas Pakistanis gave overwhelming response to the central bank initiative.

“The central bank is expected to receive record $3.5 billion inflows through RDA by December. More products are likely to attract overseas Pakistanis to invest in RDA products that will benefit the national economy,” Tariq told Khaleej Times on Sunday.

Last month, SBP Governor Dr Reza Baqir said the RDA initiative for overseas Pakistanis had generated new financial inflows of $1.8 billion which helped boost the country’s foreign exchange reserves. He said that Pakistan’s reserve buffers are expected to rise by another $2.8 billion in August through the IMF’s planned new global SDR allocation.

Banking experts and analysts were optimistic about the outlook of Roshan Digital Account and said it would continue to attract funds from overseas Pakistanis, especially those based in the Gulf region.
Good for Pakistan... Is it due to devaluation or expected devaluation non residents are sending more money...
 
Sep 8, 2009
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No , just sending cash to have a saving account in Pakistan easier to give funds to family at home makes sense and great 5 year return 7-8%, raises value for Pakistani Passport / Citizenship.

Access to insurance
Access to credit cards
Access to local mortgage
Pay your local bills fantastic

Revolutionary stuff
 

Wood

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Pakistan already pays 5% or above on sukuks and other liabilities. Though they are longer dated. I think NPC could have been priced 50 bps lower. The government is betting that it won't be hot money and the beahvioural maturity would be several years.
I had to google sukuks to understand what you meant there :-)

Goodluck with this strategy. There is usually a term limit on high interest deposits, so I don't think that there is a risk of capital flight with these. Pakistan only has to make sure that there is no default on external debt.

These accounts are similar to FCNR accounts in India. Though the Indian account has fewer takers because of less than 2% return on a 5 year deposit.
 

TacOps

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I also think Pakistan could have gotten away with 4% on 3 months and 4.5% on 6 months. There's really no incentive to go for longer tenure deposits if you get a 5% on 3 months.
 

ziaulislam

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The Roshan Digital Account (RDA) programme has crossed a major milestone and hit the $2 billion mark as overseas Pakistanis continued to pose trust in the central bank initiative that was launched in September last year.


Overseas Pakistanis invested record $2 billion in various products offered by the RDA platform and it will continue to attract more inflows as the central bank is keen to add more investment options for non-resident Pakistanis, experts say.

“As Pakistanis all over the world celebrated country’s Independence Day, #RoshanDigitalAccount crosses the historical milestone of $2bn in deposits. A big thanks to Overseas Pakistanis for their overwhelming response to the RDA initiative,” State Bank of Pakistan (SBP), the central bank, tweeted.


Imran Khan inaugurated the RDA service on September 10, 2020 for non-resident Pakistanis to enable them to remotely open bank accounts in Pakistan through online digital portals without physically visiting branches. It is a joint effort of the SBP and the federal government in collaboration with eight commercial banks operating in Pakistan. Later, more banks joined the initiative to facilitate the overseas Pakistani community.

The inflow through Roshan Digital Account reached $1.87 billion at the end of July, with the first month of the current fiscal year witnessing the second highest inflow since the RDA was launched in September last year.

View attachment 777407

Samiullah Tariq, head of research at Pakistan Kuwait Investment Company, said RDA is a huge success as overseas Pakistanis gave overwhelming response to the central bank initiative.

“The central bank is expected to receive record $3.5 billion inflows through RDA by December. More products are likely to attract overseas Pakistanis to invest in RDA products that will benefit the national economy,” Tariq told Khaleej Times on Sunday.

Last month, SBP Governor Dr Reza Baqir said the RDA initiative for overseas Pakistanis had generated new financial inflows of $1.8 billion which helped boost the country’s foreign exchange reserves. He said that Pakistan’s reserve buffers are expected to rise by another $2.8 billion in August through the IMF’s planned new global SDR allocation.

Banking experts and analysts were optimistic about the outlook of Roshan Digital Account and said it would continue to attract funds from overseas Pakistanis, especially those based in the Gulf region.
To whomever pakistani i have talked his holding his investment as they know what happened in 1998. Everyone is prediciting nawaz will be back and we will end up with IMF soon again..
So i am surprised we are getting some inflows
 

Crimson Blue

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The higher interest rate should have been and introductory incentive for people to open such accounts.

Once people become comfortable with theses accounts, SBP may decrease the interest rate. Overseas Pakistani would be content with 4% return if depsits are in USD or another stable currency.
 

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