ISLAMABAD: The government has reportedly decided to launch the “National Remittance Loyalty Program” (NRLP), aimed at offering monetary and other benefits to entice overseas Pakistanis to use official channels, sources said. knowledgeable Business recorder.
Sharing details, sources said, the prime minister chaired a meeting on improving foreign currency inflows into the country on July 2, 2021. A presentation was made by the State Bank of Pakistan (SBP) on the NRLP during the meeting. Subsequently, the Prime Minister’s Office transmitted the following decisions / orientations.
NRLP presented by SBP approved in principle. The Minister of Finance will sit with SBP and finalize the proposed remittance reward / incentive rates to provide the maximum incentive possible to senders with one week for the official launch of the NRLP by October 1, 2021.
The Ministry of Finance should coordinate with all agencies participating in the NRLP to ensure that all arrangements are in place well in advance of the launch of the NRLP.
The NRLP will offer incentives / rewards to overseas Pakistanis for sending remittances to Pakistan according to the points accumulation structure as follows:
Points accumulation structure.
On $ 10,000 per year, the reward will be 1%, $ 30,000, the reward 1.25%, and the next reward of $ 30,000 will be 1.5%.
Example, annual discounts of $ 25,000, the reward will be 10,000 * 1% + 10,000 * 1.25%. Rs 46,575 – one reward point. One reward point is equal to Rs 1.
Effective July 1: Payments will be WHT exempt
A mobile application based on Android and iOS (in English and Urdu) has been developed for this purpose by 1-Link, the development cost of which has been borne by the banks.
The operating costs of this mobile application will also be covered by financial institutions. Senders will be awarded points for each remittance transaction in accordance with NRLP criteria. Incentives will be used by redeeming points.
The other main characteristics of the NRLP are as follows: – (i) three levels: Green, Gold, Platinum; (ii) Virtual Loyalty Card “as a built-in feature; (iii) senders must register as primary users and can add an additional user / beneficiary; (iv) all home remittances through channels formalities are eligible, including funds received through RDA and used / consumed locally.
Overseas Pakistanis will be eligible for the following service equivalent to the amount of points awarded under the NRLP for redemption of accumulated points: (i) PIA international air tickets – payment for additional baggage on PIA international flights; (ii) FBR – Payment of taxes on mobile phones – personal luggage, payment of taxes on the purchase of locally manufactured vehicles, payment of taxes on imported vehicles; (iii) Nadra -renewal of CNIC / NICOP; (iv) Directorate General of Immigration and Passports – Renewal of the Passport; (v) State Life / MOOP & HRD, life insurance premium; (vi) Free OPF-OPF schools; (vii) purchases from USC utility stores; (viii) BE&OE -fees payable and; (ix) Separate CAA / FIA counters (non-monetary) for priority authorizations, placement of standing people / banners for promotion.
The estimated financial / budget impact based on the assumption that senders equivalent to 25% of remittances from FY21 will register for the NRLP, is Rs. 13.107 billion for FY22.
The budget disbursement mechanism will be the same as that applicable under other home remittance incentive programs, through which participating public sector entities (PPSES) can submit their requests to SBP BSC through 1 -Link after verification of requests by 1-Link. SBP BSC will disburse funds directly to eligible PPSEs after receipt of funds from MoF.
The summary was not circulated among stakeholders as no consultation is required at this stage. All relevant stakeholders were consulted in a series of meetings. However, other consultations will be carried out as and when required.
The Ministry of Finance proposed that the accumulation structure of this point estimated the financial impact / budget of Rs. 13.107 billion. The service to be offered by the various participating post-secondary institutions under the NRLP will be approved. In the future, other entities / services will also be added to the scheme with the approval of the Minister of Finance.
Copyright Business Recorder, 2021