SBP urges business community to discourage cash transactions

KARACHI: The governor of State Bank of Pakistan (SBP) Dr. Reza Baqir has urged the business community to discourage cash transactions in order to help the economy to grow.

Addressing the members of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Friday the SBP governor stressed the need to promote transactions through banking system.

He said that cash transactions were not better for any economy. People are making cash transactions but not giving due share to national exchequer, the SBP governor said.

He said that those people having taxable income should be brought into the tax net for economic growth.

Dr. Reza Baqir explained in detail about the issues raised by the business community including IMF, interest rate and inflation.

The governor said that current account deficit had increased very sharply during 2014 to 2017. The deficit had increased to $2 billion per month. The imbalances in payments incurred pressure on rupee value. “Yet the exchange rate was artificially controlled,” he added.

He said that since the exchange rate had been eased the current account deficit was narrowing.

He said that the foreign exchange reserves were stabilizing.

Talking about interest rate, he said that the rate had been increased to check the inflation. He said that the interest rate had witnessed high and low during the year 2012 to 2019. Despite these fluctuation the investment in private sector was remained stable, he said, adding that there were other elements which created hurdles in private sector investment.

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