Freelancers and the hassle of opening a bank account
Pakistan is home to three million freelancers who have taken us to be among the top five countries providing freelance services around the world. Pakistani freelancers earned export remittances worth $400 million in the fiscal year that ended in June this year.
The amount accounted for 14.77 per cent of the total Information and Communication Technologies (ICT) exports.
Despite their contribution to the country's economy, the community of freelancers faces a lot of problems in simply opening a bank account, which is such a pity.
A large number of Pakistanis are still outside the banking network, and the commercial banks seem bent on discouraging the citizens further, putting stumbling blocks to make the process of opening an account as cumbersome as they possibly can.
The banks do not recognise income earned through freelancing as good enough to be routed through an account. In which world they seem to be living is something that is too hard to fathom.
A couple of weeks ago, when I was expecting my first earnings from my social media channel, my request for opening a bank account was rejected. I gave several options to the bank, such as documents related to my blog, my channel or some freelance marketplace, but none of them was accepted as 'proof' of payment.
Having no other option, I attached my AdSense account to one of my relatives' bank account through which I ended up receiving my first payment. Is that what the banks want the freelancers to do? Is that what the regulatory authority, the State Bank of Pakistan (SBP), wants us to do?
Pakistani freelancers do not have access to PayPal and such other platforms used by their counterparts in other countries, and, yet, they do a great job of earning in foreign currency.
We may not convince PayPal to start its operations in the country, but at least the government can convince the banks operating in the country to recognise freelancing as an acceptable source of earning for opening a bank account.
The State Bank of Pakistan (SBP) is evaluating a proposal to allow the selling of 10 to 20 per cent of remittances received through exchange companies to bring down the greenback rates by improving its availability in the open market. Currently, the exchange companies are required to deposit entire remittances into banks.
An SBP spokesman told media that a decision to this effect will be taken next week, adding that the central bank will also monitor the dollar rates in the open market.
"The SBP can withdraw the facility if the dollar rates don't come down despite higher inflows in the open market," said the spokesman.
After taking the final decision, the central bank will issue a circular explaining the mechanism for the exchange companies for using this facility.
The open market is facing a dire shortage of dollars. The Exchange Companies Association of Pakistan (ECAP) has been regularly issuing dollar rates but neither the rate is correct nor the dollar is available.
The unavailability of dollars at exchange companies leaves no option for buyers, especially travellers and students, to procure it at much higher rates from the grey market, which is now stronger than ever and is matching the dollar rates with Kabul where the greenback price is hovering around Rs238-240.