Roshan digital accounts attract $400m in four months

KARACHI: Foreign exchange inflows through the Roshan Digital Accounts (RDAs) reached $400 million within four months, reflecting growing confidence in the State Bank’s new initiative launched by Prime Minister Imran Khan on Sept 10, 2020.

RDAs aim to attract millions of Pakistanis living abroad by offering much higher returns on deposits compared to the returns in developed economies.

“So far the total inflows in RDAs have reached $400 million,” the SBP said in response to a query on Tuesday.

A senior banker said the inflows were encouraging, but slow as per the expectations of the government and the State Bank. However, attracting $400m within four months could be a good replacement of hot money

The country had received about $3.4 billion in the domestic bonds before March FY20. The entire amount of $3.4bn landed in FY20. Most of the foreign investment which was termed hot money left the country in the last quarter of FY20 following the Covid-19 pandemic.

The SBP also said that so far the total number of accounts opened for RDAs reached 80,000. It was not known Pakistanis from which country and region opened the highest number of accounts.

However, banking experts and currency dealers say that most of the accounts were opened by the Pakistanis living in the Gulf region which provides 65 per cent of the total remittances to the country.

The RDAs have been launched for Non-Resident Pakistanis’ (NRPs) to enable them to remotely open bank accounts in Pakistan through online digital portals without physically visiting branches.

Using their RDAs, NRPs can now avail digital banking facilities, including access to online banking, domestic funds transfer, utility bills and tuition fee payment in Pakistan, as well as investments in government bills, stock exchange, and real estate sector with option of full repatriation.

“If the current account remains surplus with an improved foreign exchange reserves, the inflow through RDAs could be higher in the second half of the current fiscal FY21,” said the banker.

Along with the RDA account, the SBP launched the Naya Pakistan Savings Certificate with the aim of boosting country’s economy by attracting foreign investments.

The buyers can own the certificate in US dollar with the highest interest rate of 7pc and in Pak rupees with the highest rate of 11pc per annum provided the investment is made for 5 years.

Banks offer both Islamic and conventional accounts and in various eligible currencies (and not just USD) as per the relevant rules and regulations of SBP.