Unisame urges for increasing markup on FCAs

KARACHI: The suppression of mark-up on Foreign Currency Accounts (FCA) encourages savers to send their money out of the country or even remove it from the banking system because of negligible profit, the business community said.

The Union of Small and Medium Enterprises (Unisame) invited the attention of the State Bank of Pakistan (SBP) to the very low rate of profit given to FCA holders and urged the central bank policy makers to match it with foreign countries.

Unisame council member and a senior bank executive said that one of the major reasons for a drop in the remittances is because internationally banks are offering upto 4.5 per cent mark-up on fixed deposits, whereas in Pakistan FCA holders are virtually getting quarter percent markup or profit on their deposits.

The outflow can be reversed if the government and banks start paying market rates on FCY deposits, he said, adding that artificially suppressing mark-up is leading to leakages.

Unisame President Zulfikar Thaver termed it important for the SBP to announce and promise that FCA accounts will not be touched and the government will not freeze them under any circumstances.

The will put an end to the rumours circulating in the circles that the government will lay their hands on the dollar accounts and issue FC bonds against them, he added.

Another investment banker from one of the leading investment banks urged the government to invite the leading industrialist and the top 1,000 rich business families, and request them to bring their money invested in foreign banks to save the country from the crisis.

The government’s friendly approach will help in bringing stability in the economy rather than threats and policemen like behaviour, he said.

There is no doubt that these businessmen love their country and would do anything to save it from the adverse situation, he added.

When one of the former governments wanted to sell a leading bank, various rich parties came forward and wanted to buy it but it was sold to an existing bank because of their experience and others were requested to withdraw in national interest.

Various rich groups and politicians are in a position to bring their money to Pakistan and stand by the government to save the honour and prestige of the country.

However, a friendly approach with amnesty is required and no amount of threat can achieve and gain their cooperation. The government must adopt a friendly approach and take the business community in confidence.