State Bank of Pakistan (SBP) has allowed commercial banks / dealers to buy dollars from the interbank market in order to settle card-based international transactions during International Payment Schemes (IPS).
In a notification, the banking regulator said, “It is decided to allow authorized dealers to purchase USD from interbank for settlement of cased-based cross-border transactions with IPS [such as VISA, Mastercard, etc.] in view of representations received from stakeholders.”
Furthermore, the State Bank of Pakistan (SBP) mentioned that the notification will come into effect immediately until 31 July 2023.
It is pertinent to mention that prior to the announcement, these dealers and commercial banks were only permitted to buy USD from exchange companies for international card transaction.
However, the gap in rate provided in the open market and interbank had widened to Rs. 29 on Wednesday as the USD rate in the open market was Rs. 311-314, while the interbank rate was around Rs. 285.
The move to allow banks and dealers to buy USD from interbank brought a sharp decline in the open market rate that closed around Rs. 295-300 on Thursday.