In order to broaden the scope of business-to-customer transactions through home remittance channels, the State Bank of Pakistan (SBP) has enhanced payment limits against freelance services in computer and information systems and other freelance services from $5,000 per individual per month to $25,000 per individual per month.
The enhancement in limit will facilitate freelancers to route more funds through a more economical and efficient channel of home remittances and help in receiving foreign exchange flows through formal banking channels in the country.
This would also enable freelancers to expand their business/ operations and engage new freelancers to join the workforce. This is expected to create employment opportunities and increase foreign exchange earnings of the country.
While Export of Services has been growing in double digits, (10.5% rise registered in January, 2020), this enhancement of limits for freelancers shall further accelerate growth in Export of Services in the months ahead.
It is pertinent to mention that people in IT industry believe that exports’ values of IT and computer services don’t reflect truly from the central bank’s data as the income of freelancers from foreign clients come as remittances as received from overseas Pakistanis. Many freelancers of IT services manage their income against services of foreign clients en route to various countries through PayPal accounts of their friends or relatives to their banks accounts in Pakistan.
It is hoped that the measure will encourage freelancers to more projects from foreign clients and the remittances inflows also will reflect the gradual rise in days to come.