The World Bank has been fast to predict that international money transfer to low and middle-income countries, of which Pakistan is one, would drop by 20% as a result of Covid-19.
Thankfully, the Pakistani government has acted quickly. It plans to protect its own economy against the expected downturn with a range of incentives to encourage and support those still able to send money to Pakistan.
What are the new incentives and when do they start?
From 1 September 2020, additional incentives will be given to remitters through mobile apps and cards as part of a ‘National Remittance Loyalty Programme’, benefiting those who want to send money to Pakistan.
The programme is a collaboration between major commercial banks and government agencies and hopes to encourage remittance to Pakistan via official banking channels through rewards.
These will include offering debit and loyalty cards and smartphone-based incentive products.
Also, children of overseas Pakistanis sending remittances home will be given 50% discount in Overseas Pakistanis Foundation (OPF) School and college fees and a special quota will also be allotted to the expatriates in the OPF housing schemes.
Are there incentives already in place?
As reported in the Express Tribune, from 1 July a tax efficient scheme for remittances was launched. This incentive stated that withholding tax (the tax that is kept back from an employer and paid directly to the government) was to be exempted on cash withdrawal or on issuance of banking instruments/transfers from a domestic bank account – including remittances.
These measures have already had an impact.
Last month, Pakistan’s Finance Secretary Naveed Kamran Baloch confirmed that the flow of remittances to Pakistan had only declined by 4.3% year-on-year for the period March to May, rather than the 23% forecast by the World Bank.
Speaking to Pakistan Today of other steps which they had taken, Baloch said, “…the government adopted timely measures to mitigate these adverse impacts by asking the banks to conduct aggressive awareness campaigns to inform the senders and receivers of remittances about available digital/online channels for sending and receiving remittances”. Banks in remittance rich parts of Pakistan have also been asked to ensure the availability of cash in order to be able to meet the needs of anyone receiving money from overseas.
Sending money to Pakistan for the first time?
With the measures already in place, and those coming in from September, it is a good time to consider making your first money transfer to Pakistan.
This month also sees the start of the Eid al-Adh celebrations; a time of generosity which traditionally leads to an increase in money transfer from overseas.
At Small World we have an additional incentive of our own… there are no transfer fees to Pakistan, giving you even more value for money.
The Small World app is an easy-to-use tool which enables to you create an account with us and begin to send money online in just a few quick steps. Available from both the App Store and Google Play, it also allows you to track transfers, view your transaction history and keep up to date with live exchange rates.
What transfer options are available?
Whether you are using a money transfer company for the first time or are used to sending money in this way, it is important to choose the best option for you and your recipient.
This is why we have a range of several different services which our customers can choose from:
Cash pick-up: Customers can send money to be collected from one of our agents or partners in over 8,000 locations in Pakistan.
Traditionally, this is the most popular way to transfer money but the increase of smartphones and other digital devices means there might be a more suitable option.
If you are consider going digital for the first time, this guide will tell you everything that you need to know.
It is worth noting that currently cash over the counter payments are available in all bank branches across Pakistan. Branches will remain open (Monday to Friday) from 10:00 AM to 4:30 PM till further instructions from the State Bank say otherwise.
Mobile wallet: If your recipient does not have a bank account you can send money to their mobile wallet, the digital equivalent of a physical wallet.
You can read all about the rising importance of mobile wallets on the Small World blog.
Airtime top-up: As well as sending funds for collection or to an account, you can also transfer money to a mobile provider which your recipient will then receive as airtime.
By choosing the best option for you and your recipient you will be able to make the most of the government incentives and continue to support your friends and family in Pakistan, as well as the country’s economy.
The most popular ways to send money to Pakistan
- Cash Pick-up
- Bank Deposit
- Mobile Top-up
Our main partners in Pakistan are: MCB Bank, Wall Street, UBL, National Bank of Pakistan, Bank Alfalah, Allied Bank, Soneri Bank, JS Bank, and Bank AL Habib.