05 Sep 2024
Pakistan's economy heavily depends on remittances, which provide the country's foreign exchange reserves a much-needed boost by bringing in foreign currencies. According to the Migrant Resource Centre, Pakistan is ranked sixth globally for annual remittance receipts, with $19.3 billion. But this amount increases by $50 billion if Pakistani expats do not send money to Pakistan through illegal Hawala/Hundi ways. This article will help you understand the legal and illegal ways of remittances in Pakistan.
According to Dawn News, remittances increased sharply by more than 35%, from $23.1 billion in FY20 to a peak of $31.3 billion in FY22. Nonetheless, there has been a significant decline in the current fiscal year; in the first 11 months of May, the nation lost $3.7 billion in remittances. Inflows fell from $28.5 billion to $24.8 billion a year ago, a decrease of about 13 percent.
The lost amount is more than three times more than the $1.2 billion IMF tranche Islamabad has been fighting for the past seven months. Remittances have been Pakistan's primary source of external account support in the last few decades, even if the country's annual export revenues have been overshadowed in recent years due to dwindling foreign assistance.
According to a State Bank of Pakistan (SBP) deputy governor, Pakistan's misery index increased from 15.2 to 36.8 in the last few years. The misery index is composed of the aggregate unemployment and inflation rates in the nation.
One essential government initiative to improve the flow of remittances is the Pakistan Remittance Initiative (PRI). The State Bank of Pakistan (SBP), the Ministry of Finance (MoF), and the Ministry of Overseas Pakistanis (MOP) together founded PRI, which is concentrated on:
Traditional yet illicit remittance routes like Hundi and Hawala have long been used to get around expensive taxes and rules from the government. The Pakistani government has responded to this by clamping down on these operators and advising its migrant population to transfer money through authorised and regulated channels. This action:
The government is actively promoting lawful money transfer methods in an effort to promote a business-friendly atmosphere. Thanks to this backing, businesses like ACE Money Transfer, which is well-known both domestically and abroad, have grown. With these companies, remittances to Pakistan can be completed in as little as 7 seconds, giving migrants a speedy and safe way to support their families back home.
The remittance pattern changes along with the worldwide migration landscape. Remittances are predicted to increase as more Pakistanis migrate overseas in search of better prospects. The persistent political unrest in Pakistan is pushing more people to look for work abroad, which is contributing to a significant rise in remittances. Appropriate actions need to be taken to handle this influx efficiently.
More authorised remittance avenues must be established due to the increasing number of Pakistani migrants abroad. This growth will:
Legal routes are the safer and more dependable choice despite the temptation to use illegal channels due to the risks involved.
2024 predicts that as technology advances, financial transactions will change in ways that will be determined by:
Thanks to the PRI program, Pakistani migrants now have more investment prospects. As remittances increase, the government will probably create additional investment opportunities across various industries, enticing migrants to make investments domestically rather than abroad.
For both service providers and migrants, security continues to be of the utmost importance. Since remittances contain money acquired through hard work, it is crucial to focus on protecting funds and transactions. To provide secure and effective money transfer services, service providers like ACE Money Transfer are always developing and incorporating cutting-edge technologies.
ACE Money Transfer is a dependable alternative when selecting a remittance service for an online money transfer to Pakistan. It provides:
ACE Money Transfer is cognisant of the requirements of Pakistani immigrants and adjusts to the evolving remittance scene.
It is impossible to overestimate the role that remittances play in helping Pakistan's economy and individual households as the country's population continues to rise. 2024 looks promising for a safer and more affluent future for Pakistani migrants and their families because of government steps to support lawful remittance channels and the growing efficiency of services. Sign up for the fastest remittance service with ACE Money Transfer to send money online to Pakistan with ease!
The Pakistan Remittance Initiative (PRI) is a government program launched as a joint venture by the State Bank of Pakistan (SBP), the Ministry of Finance (MoF), and the Ministry of Overseas Pakistanis (MOP). The program aims to facilitate the smooth, efficient, and cost-effective transfer of remittances. It also creates investment opportunities for Pakistani migrants, encouraging them to contribute to their homeland’s development.
The Pakistani government is cracking down on Hundi and Hawala because these traditional channels are often used to evade taxes and government regulations. By encouraging legal and regulated remittance channels, the government aims to ensure compliance with financial laws and enhance the security of transactions, protecting the hard-earned money of Pakistani migrants.
The government of Pakistan supports legal remittance transfer channels by creating a business-friendly environment, which allows companies to establish and operate effectively within the country. This support helps companies like ACE Money Transfer to expand their services, offering fast, secure, and reliable money transfer options for Pakistani migrants.
In 2024, Pakistani migrants can expect several improvements in remittance services, including:
ACE Money Transfer is recommended for online money transfers to Pakistan because it offers competitive exchange rates, secure transactions, and rapid transfer speeds, with transactions completed in under 7 seconds. The company continuously evolves to meet the changing needs of Pakistani migrants, integrating the latest technologies to ensure a convenient and comfortable remittance experience.
