The State Bank of Pakistan (SBP) has increased the retention rate on contractors’ special foreign currency bank accounts from 35% to 50%.
The facilitation will encourage the independent contractor to increase their export earnings and bring in additional foreign currency.
ESFCA retention limits have been raised from 35% to 50% of export revenues, and retained funds have been liberalised. In a circular, the central bank declared that freelancers can now make current account-related payments abroad without SBP approval.
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Recently, the Ministry of IT and Telecommunication advised IT enterprises exporting IT and IT services to get the same approval.
Today, the SBP notified IT companies and independent contractors.
The central bank also issued a framework for freelance bank accounts. Freelancers can open an ESFCA and a primary rupee account concurrently.
The gig economy needs the central bank’s assistance from freelancers, according to PAFLA president Tufail Ahmed Khan. Attracting foreign clients will encourage freelancers to open overseas current accounts and receive remittances.
He stated that the policy on foreign currency accounts should be maintained over the long term, while commercial institutions should also support this move and make it simple for independent contractors to open local and foreign exchange accounts.
He added that as the contractors concentrate on foreign markets, the country will not only receive foreign exchange but also additional tax revenues.
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