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Tuesday, July 16, 2024

May Marks Pakistan’s Record Remittance Inflow

In May 2024, Pakistan recorded its highest-ever monthly remittance inflow of $3.2 billion, marking a significant 54 percent increase from the previous year. The surge, attributed to seasonal trends and expatriate contributions, underscores the vital role of remittances in Pakistan's economy.

In May 2024, Pakistan experienced a remarkable surge in remittance inflows, reaching a historic high of $3.2 billion, as reported by the State Bank of Pakistan (SBP). This represents a substantial 54 percent increase compared to the same period last year, when remittances stood at $2.1 billion. This surge marks the highest-ever monthly remittance inflow recorded in Pakistan’s history, signifying a significant milestone for the country’s financial landscape.

Several factors contributed to this notable increase in remittance inflows during May. One key factor is the seasonal trend, with expatriate Pakistanis typically sending more funds to their families ahead of Eid ul Azha, a major religious festival in Pakistan. This practice is particularly prevalent among individuals residing in non-Muslim countries, who prioritize fulfilling their religious obligations by providing additional financial support to their loved ones back home. Such seasonal patterns consistently drive up remittance inflows during specific periods throughout the year.

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A closer look at the sources of these remittances reveals interesting insights into their geographic origins. Saudi Arabia emerged as the top contributor, with remittances totaling $819 million, closely followed by the United Arab Emirates (UAE) at $668 million. Additionally, significant contributions were observed from the United Kingdom (UK) with $473 million, European Union (EU) countries with $340 million, and the United States (US) with $360 million. These figures underscore the diverse distribution of remittance sources, highlighting the significant role played by overseas Pakistanis residing across the globe.

Read more: Remittances: A Boon or Bane for Growth?

Beyond the exceptional performance in May, the broader trend of remittance inflows remains robust. For the 11-month period spanning July to May of the fiscal year 2023-24 (11MFY24), total remittances amounted to $27.1 billion. This reflects a notable 7.7 percent year-on-year increase from the corresponding period in the previous fiscal year, when remittances stood at $25.1 billion. Such sustained growth underscores the resilience of Pakistan’s remittance economy and its pivotal role in supporting the nation’s financial stability and economic development.