Data released by the State Bank of Pakistan (SBP) on Thursday shows that the Roshan Digital Account (RDAs) cash inflows continue to rise for the month of July as well.
The data shows that under the initiative that began in September 2020, the number of accounts opened by people has reached 199,747 by the end of July 2021. This translates into a cumulative $1.869 billion of cash inflows in over 10 months.
Data released by the central bank showed that the initiative received an inflow of $307 million in the month of July, compared to $310 million in June, showing a trend where the inflows remained on the upward of $300 million for a month.
Among the total inflows of $1869 million, by the 21st July, 68.4 per cent are investments in the Naya Pakistan Certificates. This means that out of the $1869 million, a high proportion translating to $1278 million are investments in government securities.
The RDA was introduced by the SBP in September 2020 for non-resident Pakistanis to enable them to remotely open bank accounts in Pakistan through online digital portals without physically visiting branches.
This arguably took off because of its timing and efficiency, as the pandemic-related travel restrictions made it difficult for the unregulated traditional practices of Hawala and Hundi to continue, and the only feasible alternative was the RDAs.
Secondly, the government’s very attractive securities allowed the overseas Pakistanis to find a source of revenue that was highly profitable and safe, increasing trustability and thus inflows.
Foreign Exchange Reserves
According to the latest data, the net reserves with the state bank have reached $17.846 billion by the 30th of July. The reserves went up by $16 million from $17.829 billion recorded on July 23.
It is worth mentioning that the total liquid reserves stood at $24,853.2 million. The net reserves held by banks amounted to $7,007.2 million.
These will get bolstered, as the Board of Governors of the IMF has approved a general allocation of Special Drawing Rights (SDRs) equivalent to US$650 billion to boost global liquidity.
According to Governor State Bank Dr. Raza Baqir, who while announcing the monetary policy on 28th July said, “In August, Pakistan’s reserve buffers are expected to rise by another $2.8bn through the IMF’s planned new global SDR allocation.”