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Tag: State Bank of Pakistan

  • SBP fixes merchant discount rate up to 2.5% on digital payments

    SBP fixes merchant discount rate up to 2.5% on digital payments

    KARACHI: State Bank of Pakistan (SBP) on Friday announced that Merchant Discount Rate (MDR) for Point of Sale (POS) acquiring Pakistan shall be within the range of 1.5%-2.5% for both existing and new merchants.

    The following merchant categories shall be exempt from this requirement:

    Government and Utilities

    MCC 9211: Court Costs, Including Alimony and Child Support

    MCC 9222: Fines

    MCC 9223: Bail and Bond Payments

    MCC 9311: Tax Payments

    MCC 9399: Government Services (Not Elsewhere Classified)

    MCC 4900: Utilities -Electric, Gas, Water and Sanitary

    Education

    MCC 8211: Elementary and Secondary Schools

    MCC 8220; Colleges, Universities, Professional Schools and Junior Colleges

    MCC 8241: Correspondence Schools

    MCC 8244: Business and Secretarial Schools

    MCC 8249: Vocational and Trade Schools

    MCC 8299: Schools and Educational Services (Not Elsewhere Classified)

    Fuel

    MCC 5541: Service Stations

    MCC 5542: Automated Fuel Dispensers

    MCC5172: Petrolium and Petroleum Products

    MCC 5983: Fuel -Fuel Oil, Wood, Coal, Liquefied Petroleum

    The SBP said that the Interchange Reimbursement Fee (IRF) for debit and prepaid cards issued in Pakistan used on domestic POS terminals shall be capped at 0.5 percent.

    The central bank said that during the past few years, there has been considerable growth in the digital payment infrastructure of the country, especially in the number of debit cards being issued by the banks to their customers.

    Although, the Point of Sale (POS) infrastructure has also grown during the past few years, its growth has largely remained restricted to high value merchants in big cities.

    Some of the key challenges being faced by the POS acquiring industry in Pakistan include high Interchange Reimbursement Fee (IRF), lower than cost Merchant Discount Rate (MDR) to onboard high value merchants and less interest by banks in offering low cost domestic payment cards to their customers.

    The SBP said that the card issuers shall offer SBP approved Domestic Payment Scheme (DPS) Card as the default card at the time of issuance or renewal of debit cards.

    Accordingly card requesting customers shall be offered the following options in order of priority:

    Either an exclusive DPS card or a DPS card co-badged with an International Payment Scheme (IPS)

    An exclusive IPS card upon written request of the customer

    The central bank said that the instructions shall come into effect from April 01, 2020.

  • Foreign exchange reserves up by $91 million

    Foreign exchange reserves up by $91 million

    KARACHI: The liquid foreign exchange reserves of the country increased by $91 million to $18.362 billion by week ended January 24, 2020, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at Rs18.271 billion a week ago.

    The reserves held by the central bank increased by $184 million to $11.915 billion by week ended January 24, 2020 from $11.731 billion a week ago.

    The reserves held by commercial banks fell by $93 million to $6.447 billion from $6.538 billion.

  • SBP enhances borrowing limit under LTFF to Rs5 billion

    SBP enhances borrowing limit under LTFF to Rs5 billion

    KARACHI: The State Bank of Pakistan (SBP) has enhanced the maximum borrowing limit under Long Term Financing Facility (LTFF) to Rs5 billion from Rs2.5 billion.

    In a statement on Tuesday, the central bank said that it had extended the scope of LTFF to cover all permissible export oriented sectors.

    This step is aimed at setting up of diverse export oriented projects in Pakistan and to boost exports in multiple sectors.

    Further, to accommodate enhanced financing requirements of exporters for setting up long term export oriented projects, maximum limit of Rs. 2.5 billion has been enhanced to Rs. 5 billion per project under LTFF.

    In line with the above measure, SBP has also provided additional concessional financing of Rs.200 billion to banks including Rs. 100 billion under Long Term Financing Facility (LTFF) and Rs. 100 billion under Export Refinance Scheme (EFS), to be utilized by June 30, 2020.

    Going forward, to further promote SME exporters, SBP in consultation with the relevant stakeholders, is in the process of devising an elaborate mechanism for the allocation of LTFF and EFS to SME exporters.

    These changes are likely to be announced in March 2020.

  • SBP allows 100% advance payment for import

    SBP allows 100% advance payment for import

    KARACHI: State Bank of Pakistan (SBP) has allowed 100 percent advance payment for import of various goods against letter credit.

    The SBP in a statement on Tuesday said that with a view to facilitate importers, SBP has allowed banks to make advance payment up to USD 10,000/-, or equivalent thereof, per invoice on behalf of commercial importers for import of raw material, spare parts and machinery.

    Besides, SBP has also allowed banks to make payments on behalf of commercial importers for imports of raw materials and spare parts on Open Account.

    In addition, SBP has also enhanced the existing limit of 50 percent advance payment, allowed to manufacturing concerns, for import of plant, machinery, spare parts and raw materials etc. against letter of credit, to 100 percent.

    In December 2019, SBP allowed advance payment of up to 50 percent of the value of imports against letter of credit to manufacturing concerns for import of plant, machinery, spare parts and raw material etc.

    After the implementation of a market based exchange rate system, the balance of payments has witnessed significant improvement. In the first six months of the current fiscal year, the current account deficit has contracted by 75 percent to US$ 2.15 billion.

    This improvement is helping to further relax some of the restrictions on imports by SBP.

    The latest measures, taken today, are in continuation of facilitating export-oriented industries and manufacturing concerns in the backdrop of ease of doing business and promoting exports’ growth.

    These measures will further contribute in improving economic outlook of the country.

  • SBP keeps policy rate unchanged at 13.25%

    SBP keeps policy rate unchanged at 13.25%

    KARACHI: The State Bank of Pakistan (SBP) announced on Tuesday that it has decided to maintain the policy rate at 13.25%. SBP Governor Dr. Raza Baqir conveyed this decision, which was made during the Monetary Policy Committee (MPC) meeting. The SBP emphasized that the outlook for inflation remains steady, prompting the committee to retain the current monetary policy stance.

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  • Murtaza Syed appointed as SBP deputy governor

    Murtaza Syed appointed as SBP deputy governor

    KARACHI: The federal government has officially appointed Dr. Murtaza Syed as Deputy Governor of the State Bank of Pakistan (SBP), in accordance with Section 10(4) of the SBP Act of 1956 (as amended), the central bank announced on Tuesday. Dr. Syed assumed his responsibilities at the SBP on January 27, 2020, bringing with him a wealth of experience in macroeconomic policy and research.

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  • Foreign exchange reserves increase to $18.271 billion

    Foreign exchange reserves increase to $18.271 billion

    Pakistan’s liquid foreign exchange reserves saw a notable increase of $148 million, reaching a total of $18.271 billion by the week ending January 17, 2020, according to a statement released by the State Bank of Pakistan (SBP) on Thursday.

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  • SBP to announce monetary policy on January 28

    SBP to announce monetary policy on January 28

    The State Bank of Pakistan (SBP) is set to unveil its monetary policy for the upcoming two months on Tuesday, January 28, 2020, as confirmed by a statement released on Tuesday.

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  • Banks asked to ensure compliance in collection of donations for Dam Fund

    Banks asked to ensure compliance in collection of donations for Dam Fund

    KARACHI: State Bank of Pakistan (SBP) on Monday said any laxity by banks in collection of donations for Dam Funds will tantamount to contempt of court.

    “The apex court of the country [Supreme Court of Pakistan] is monitoring progress in the matter of donations to the Fund. Any laxity by banks or their staff at branches will attract penal action and may also tantamount to contempt of court,” the SBP said.

    The banks are therefore, advised to ensure meticulous compliance of above instructions and extend full cooperation to donors in deposit of their donations/contributions, the SBP added.

    The central bank said that in a recent hearing of the subject case, the Honorable Supreme Court of Pakistan has observed that there are complaints that banks are not accepting donations from people contributing to the Dam Fund, and are also not actively facilitating donors in remittance of the funds stuck abroad.

    In order to address the issues being faced by donors, banks are advised to ensure that the arrangements made for collection of donations and contributions to the Dam Fund shall remain in place at every bank branch on an ongoing basis; requiring all concerned to provide necessary support and facilitation to donors.

    The banks are further directed to ask their overseas branches to facilitate the donors in depositing and remittance of donations to the Fund in accordance with the legal and regulatory framework of concerned jurisdiction.

    The banks shall display SBP’s helpline number and email address on their websites and branch notice boards for lodging of complaints by donors if they face any difficulty in depositing and contributing to the Fund.