SBP launches crackdown against exchange companies State Bank of Pakistan

SBP launches crackdown against exchange companies

KARACHI: The State Bank of Pakistan (SBP) has launched crackdown against exchange companies in order to end volatility in rupee value against the US dollar.

A statement issued on Wednesday, the central bank said in view of recent volatility in the exchange rate and the difference between the interbank rate and the rate offered by Exchange Companies (ECs) and banks to their customers, it had increased the monitoring of the foreign exchange operations of ECs and banks.

READ MORE: Pakistani Rupee makes historic recovery; dollar ends at Rs228.80

In this respect, SBP started inspections of a number of exchange companies and banks since Monday (August 1, 2022).

On Tuesday (August 2, 2022) SBP suspended the operations of four branches of two ECs (Galaxy Exchange Co and Al-Hameed International Money Exchange Co) for violation of SBP regulations.

READ MORE: UBL declares 21% decline in half year net profit

SBP has also imposed monetary penalties on some ECs in the recent past. Besides, due to violations of SBP instructions, arrangements of 13 franchises have been terminated by six different ECs in the recent past.

SBP has also started conducting mystery shopping exercise throughout Pakistan to investigate the apprehensions that some ECs are not selling foreign currency to their customers.

READ MORE: SBP introduces foreign currency, rupee value business accounts

A meeting of the Exchange Companies Association of Pakistan has also been called on August 4, 2022.

If needed, SBP would augment its enforcement actions on the ECs and the banks in light of findings of the on-going inspections and mystery shopping.

READ MORE: SBP imposes Rs85 million as penalty on JS Bank