What Is Foreign Currency Account?

The state bank of Pakistan has introduced a number of reforms in the foreign exchange control in country. The main purpose of introducing the various reforms is to strengthen the foreign exchange reserves such which hover around two and three billion dollars and are only sufficient to cover the import bills of the country for three weeks only. The salient features of the opening of foreign currency accounts for boosting remittances and mobilizing foreign exchange resources. The designated branches of commercial banks by the State Bank of Pakistan are only authorized to deal in foreign currency deposits. The deposits can be accepted in all foreign currencies. However to keep the operation smooth it desired that the deposits should be accepted in United States dollar. The deposits can be accepted both from residents and non-resident which include Pakistan and foreign national, a firm or company. Foreign currency deposits under the new rules of 1998 can be accepted in saving and in terms only.

Interest rates on foreign currency saving deposits and term deposits are fixed by the State Bank of Pakistan and they are to be paid monthly on saving deposits and on maturity in case of term deposits. Foreign currency deposits under the new rules are not required to be surrendered to State Bank of Pakistan.

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