Islamabad, Aug 22: Prime Minister Shehbaz Sharif announced on Thursday that Pakistan has launched a project to connect its immediate payment system, Raast, with the Arab Monetary Fund’s (AMF) Buna cross-border payment system. This will enable real-time remittances between Pakistan and the Arab world.
In order to create a framework of cooperation between Rasst and Buna, which is run by the Arab Regional Payments Clearing and Settlement Organization (ARPCSO) and backed by all central banks in the Arab region, the AMF and the State Bank of Pakistan (SBP) signed a memorandum of understanding in Abu Dhabi last November. The advancement makes it possible for Buna to accept the Pakistani Rupee (PKR) in addition to other international and Arab currencies as a means of settlement.
According to official figures, Pakistan receives remittances and cross-border retail payments totaling more than $20 billion from the Arab world each year. After Sharif announced the project, the prime minister’s office (PMO) released a statement saying, “Under the project, the digital payment system of Pakistan is being directly linked to Buna established under the Arab Monetary Fund.” “A quick, efficient, and affordable plan to send money to Pakistanis living abroad has begun to be implemented.”
According to the PMO, millions of Pakistanis residing in Arab nations will be able to send money home “quickly, effectively, and at a low cost” thanks to the Buna-Raast system, which would also boost remittance transfers.Speaking at the opening ceremony, Prime Minister Sharif stated, “This historic initiative aims to facilitate our fellow Pakistanis living abroad and ensure that their efforts translate seamlessly as well as timely to support for their families back home in Pakistan.”
Remittances will become more inexpensive and easily available thanks to this, Pakistan’s first cross-border real-time payment system linkage. Furthermore, it has the capacity to quicken our connection into a crucial payment connectivity model of the future in which transactions will occur across regional boundaries.
Saudi Arabia and the United Arab Emirates are Pakistan’s top destinations for laborers, and each month they contribute the most in the form of remittances to the country. According to authorities from both the Pakistani and AMF sides, the Buna-Raast project aims to address the major issues with cross-border remittances, which are frequently impacted by inefficiencies and excessive costs, in order to bring more flows into the legitimate channels.
Remittances will safely and quickly reach their intended recipients by utilizing Buna and Raast’s strengths. In a July statement regarding the Buna-Raast collaboration, Fahad M. Alturki, Director General Chairman of the AMF Board and Chairman of the Board of ARPCSO, stated, “Our joint efforts are a testament to our shared vision of advancing financial inclusion and creating lasting values for our economies.”
According to Jameel Ahmad, Governor of the State Bank of Pakistan, “Raast and Buna integration and addition of the Pakistani rupee in Buna as a settlement currency is a strategic milestone aimed at increasing the speed, safety, and cost-effectiveness of remittances and other cross-border payments between Pakistan and Arab countries.Through formal channels, the partnership will increase remittances to Pakistan, with improved customer convenience and efficiency.”
