SBP Extends Facility Allowing IT Exporters to Keep 35% of Export Earnings in FCY Accounts

The State Bank of Pakistan (SBP) has extended the deadline for the mandatory credit of 35 percent of the export proceeds into special foreign currency accounts of IT companies and freelancers until June 30, 2024. Back in January, in order to encourage IT companies and freelancers to bring their foreign exchange earnings into the country, the central bank advised ADs to mandatorily credit 35 percent of the export proceeds into these exporters’ special foreign currency account. Under the guidelines issued by the central bank at the time, the exporters should be registered with Pakistan Software Export Board (PSEB) or Pakistan Software Houses Association (P@SHA), and involved in the export of Software, Information Technology (IT) services, IT Enabled Services (ITeS). SBP also advised ADs to facilitate these exporters in opening their exporters’ special FCY accounts and for carrying out remittances transaction from their Exporters’ Special FCY retention accounts by issuing corporate debit cards, and providing digital platforms including FX digital portal, after necessary due diligence and establishing mechanism for ongoing monitoring of permissible payments abroad to meet their business requirements. However, these instructions were valid until March 31, 2023. The central bank has now extended the validity of the instructions up to June 30, 2024, through EPD Circular Letter No. 09 of 2023.