KARACH - During FY17, home remittances declined by 3.1 percent to 19.3 billion dollars as compared to 19.9 billion dollars in the preceding year. The fall in home remittances was recorded for the first time since FY04. This decline is mainly attributed to sharp decline in oil prices. Home remittances from Middle East fell by 5.1 percent to $12.1 billion in FY17 compared with $12.8 billion in the preceding year, said State Bank of Pakistan.

Consequently, the share of home remittances from Middle East declined to 62.7 percent in FY17 from 64.0 percent in FY16. Qatar is the only Middle Eastern country which posted positive growth of 6.2 percent in remittances to Pakistan during the year.

Increased disclosure requirements and subsequent increase in compliance costs in USA led to a fall in home remittances by 3.2 percent in FY17. Specifically, home remittances declined from $2.5 billion in FY16 to $2.4 billion in FY17.

Home remittances from UK to Pakistan declined by 9.4 percent during FY17 mainly due to a sharp depreciation in British Pound against US dollar (i.e. 12.3 percent) after the announcement of Brexit to end-June 2017. This suggests that if adjusted for depreciation, remittances from UK have actually increased in British Pound terms.

Money Service Businesses (MSBs) in UK and Australia are facing problems in transferring funds due to closure of bank accounts as banks adopted wholesale de-risking policy. MSBs without a bank account have to share their income with other entities for transferring their funds.