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Thursday, February 15, 2024

Overseas Pakistanis can now redeem cash-rewards for sending remittances

The federal cabinet of Pakistan under the presidency of Prime Minister Imran Khan has approved the redemption of cash for the points earned by remitters under National Remittance Loyalty Programme from October onwards.

The federal cabinet led by Prime Minister Imran Khan has decided to allow the remitters to redeem in-cash rewards for the points earned for sending remittances to Pakistan through official channels.

The facility will be launched under the National Remittance Loyalty Programme (NRLP) to be launched on Oct 1, Dawn reported.

According to the Dawn source, Finance Minister Shaukat Tarin requested that this decision by the Economic Coordination Committee (ECC) on the loyalty programme be ratified with the point that the points can be redeemed by remitters in the form of cash.

It is worth mentioning that the ECC of the cabinet presided by the finance minister had approved the NRLP on 11th August, as a way to incentivize non-resident Pakistanis to remit more money to Pakistan, via official channels.

Read more: Pakistan reserves increase to $16,417.3m as country records highest ever remittances

Official summary of the ECC meeting from 11th August read, “The NRLP will offer incentives/rewards to Overseas Pakistanis for sending remittances to Pakistan based on point’s accumulation structure as follows:

On $ 10,000 per annum, reward will be 1 per cent, $ 30,000, reward 1.25 per cent and next $ 30,000 reward 1.5 per cent. Meaning a person who remits $25,000 would be entitled to Rs46,575 in accordance with the points accumulated.

This scheme, approved by the Prime Minister earlier on 2nd July will cost the national exchequer Rs13.1 billion this year.

This number is based on the assumption that the 25pc of the total remitters to the country would have registered for the NRLP.

According to Dawn, budget disbursement mechanism will be identical to other incentive schemes such as home remittances, whereby Participating Public Sector Entities (PPSEs) may submit their claims with the State Bank of Pakistan through 1-Link after verification of claims. The SBP will directly disburse funds to eligible PPSEs after receipt of funds from the finance ministry.

Reportedly, the process will be done through the mobile app, which has already been developed to achieve the objective by 1-Link. The development cost of the app has been borne by the banks.

The operating cost of this Mobile App shall also be taken up by financial institutions. The remitters will be awarded points against each remittance transaction in accordance with the NRLP criteria above. The incentives shall be availed through the redemption of points.

The salient features of NRLP will have the following three tiers, namely, Green, Gold, and Platinum. The NRLP will come with Virtual Loyalty Card” as an additional built-in feature.

Read more: PM thanks overseas Pakistanis as remittances 43pc higher YoY

The remitters shall register as Primary Users and can add one Supplementary User, who may be a Beneficiary.

It is worth mentioning that all home remittances through formal channels are eligible, including funds received through Roshan Digital Accounts (RDAs) and used locally.

The points can then be redeemed at different places, such as to obtain PIA tickets, payment of extra luggage on PIA flights, duty payments for mobile phones, tax payment on purchase of locally manufactured vehicles, payment of duty on imported vehicle, renewal of CNIC/NICOP, Renewal of Passport, USC-utility stores purchases, CAA/FIA (non-monetary) separate counters for priority clearances, among others.

Read more: PM Khan calls overseas Pakistani “asset” for the country

After the recent cabinet approval, the points can even be redeemed for cash, which in many cases maybe more of an incentive than the in-kind rewards.