Dealers Hit Hard as State Bank of Pakistan mandates Account-Based Dollar Transfers

KARACHI – US Dollars, once handed over across the counter, would now transfer only through bank accounts.

Questions piled up, and sense of uncertainty sparked frenzy among dealers as the country set new rules in light with central bank’s policy. State Bank of Pakistan clamped down on cash dollar purchases, ordering banks and exchange companies to deliver foreign currency directly into buyers’ accounts instead of handing out cash.

The surprise directive issued through fresh State Bank circular aims to push Pakistan into fully cashless foreign-currency ecosystem, but has already sparked confusion, frustration, and fierce debate across the financial sector.

Under the new rules, anyone purchasing dollars for deposit into a foreign currency (FCY) account will not receive cash. Instead, the exchange company must transfer the dollars electronically into the buyer’s foreign currency account.

Those who do not have FCY account are apparently blocked from buying cash dollars for deposit altogether. Exchange companies said customers will now be handed cheques instead of cash, which could take some working days to clear. Only buyers whose FCY accounts are in the same bank as the exchange company will receive instant transfers.

Individuals can no longer buy more than $500 without declaring why they need foreign currency, undergoing biometric verification, and producing supporting documents. Travelers, students, and those preparing for Haj or Umrah will have to submit complete paperwork for any amount above this threshold.

Open money changers are lamenting SBP new move, saying the decision clearly benefits bank-owned exchange outlets, which the central bank has been pushing to expand. Industry insiders say the new system will drive business away from private exchange companies and toward bank-controlled ones.

Adding fuel to market frustration, the SBP has barred exchange companies from keeping cash dollar balances in their bank accounts. Dealers say this forces them to sell directly into the interbank market, stripping them of operational flexibility.