Cutting remittance fees by 2-3% could add $1bn a year, PVARA chair says

Shaving two to three percent off the cost of sending money home could add $1 billion a year to Pakistan's economy, the chairman of the Pakistan Virtual Assets Regulatory Authority said, framing cheaper remittances as a direct gain to the country's foreign exchange reserves.

Bilal Bin Saqib, who is also minister of state, said PVARA and the State Bank of Pakistan are working through a joint working group on the plan. The two regulators are exploring a pilot project aimed at remittance corridors from Gulf countries, intended to bring in digital settlement systems that cut transfer charges for Pakistani expatriates in the Middle East. Official frameworks are being drawn up to connect the new technology with conventional banking, he said.

The minister put commercial banks at the centre of the effort. Lenders would need to cooperate on shared infrastructure, custody services and cyber security, and upgrade their technical capacity to handle low-cost digital transfers, he said. Public-private partnerships across the banking sector, in his account, are what would make scalable, low-fee channels possible - and what would make formal routes more attractive than informal ones to overseas senders.

Security is the other condition. Saqib said banks and regulators must harden their cyber defences to protect digital financial networks and hold public trust in the new channels, with mandatory security standards being drawn up to guard transactions and personal data. Lenders are being urged to invest in cyber defence tools as they adopt the new models.

Remittances are a primary source of foreign exchange for the national treasury, and the government expects the reforms to push more overseas Pakistanis towards official banking and digital channels rather than informal money transfer systems. According to Token Times, authorities plan to watch the Gulf pilot closely before deciding whether to extend the model nationwide.