Pakistan receives $2.411bln through RDA in 12 months

Our Correspondent
Saturday, Oct 09, 2021

KARACHI: The foreign exchange inflows through the Roshan Digital Account (RDA) reached $2.411 billion in last 12 months, the central bank data showed on Friday.

Non-resident Pakistanis (NRPs) opened 248,723 accounts from 175 countries till the end of September.

The country received $297 million from the non-resident Pakistanis in RDA in September, which was higher than the $245 million fetched in the previous month.

The data issued by the State Bank of Pakistan (SBP)showed that RDA inflows picked momentum since April this year, supporting the country’s foreign exchange reserves. These inflows also help the government in a time when it is facing a high current account deficit.

The RDA was launched in September last year in collaboration with commercial banks to provide innovative banking solutions for millions of overseas Pakistanis, including Non-Resident Pakistan Origin Card (POC) holders, seeking to undertake banking, payment, and investment activities in Pakistan.

Out of the total inflows, $1.66 billion has been invested in Naya Pakistan Certificates (NPCs) as of September 30, 2021, with $962 million in conventional NPCs and $698 million in Islamic NPCs.

Analysts said RDA scheme has become one of the major sources to maintain the foreign currency reserves after workers’ remittances and export earnings.

Besides, the RDA inflows can reduce the country’s reliance on short-term commercial borrowing over a period of time.

The SBP introduced the new products Roshan Apna Ghar and Roshan Apni Car in August.

The Roshan Apna Ghar would facilitate overseas Pakistanis to buy a house for themselves and/or their families in Pakistan.

Under Roshan Apna Ghar, two types of financing facilities are being offered. First, standard financing in which both lien based and non-lien based financing is available. In lien-based financing, the NRPs can obtain house finance facility against lien on their RDA deposit balances or NPCs.

Banks can finance up to 100 percent of the property value for purchase or construction of a house; for renovation of house, financing is capped at 40 percent of the property value.

Non-lien based financing is the typical housing finance offered against mortgage of the property to be purchased; banks may fund up to 85 percent of the property value for purchase or construction of house, and up to 30 percent of the property value for renovation of house.