In a startling development, it was disclosed during a high-level meeting of the Prime Minister’s Committee on IT Export Remittances that only 38,000 of Pakistan’s 2.32 million freelancers have bank accounts in the country.
According to a statement released by the Finance Division on Friday, the meeting chaired by Finance Minister Muhammad Aurangzeb deliberated on exploring ways to boost the flow of IT export remittances.
Aurangzeb underscored the IT sector’s critical role as a rapidly growing industry contributing to Pakistan’s economic growth.
“The IT sector has the potential to be a cornerstone of foreign exchange generation through export remittances. A collaborative approach, consistent policies, and targeted reforms are essential to unleash its full potential and repatriation of foreign earnings,” he said.
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The meeting highlighted the IT sector’s opportunities and challenges, focusing on improving the ease of capital movement to boost IT export remittances.
Participants noted that while IT exports are steadily increasing, a substantial portion of revenue remains unremitted.
The participants emphasized the “need for simplified procedures, consistent tax exemptions for freelancers, and addressing issues related to remote workers classification and small IT firms to create a more favourable environment for IT businesses to remit their earnings back into the country”.
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“It was noted that Pakistan is home to 2.32 million freelancers - contributing 15% of IT exports - yet only 38,000 hold bank accounts,” read the statement.
The participants noted that while 500 new accounts are being opened weekly, as per State Bank of Pakistan (SBP) data, retaining these account holders and encouraging others to follow the course is of crucial importance.
Governor SBP updated the committee on measures that have been taken to address these challenges, including “streamlining account opening procedures, awareness campaigns, improving complaint resolution mechanisms and prioritizing the IT sector in banking frameworks”.
As per the Finance Division statement, participants also explored leveraging the Roshan Digital Account (RDA) to facilitate international remittances for IT companies and freelancers.
“The discussion stressed the urgent need for access to global payment gateways like PayPal and the creation of similar payment solutions at home to empower IT professionals and freelancers and enhance Pakistan’s global competitiveness,” read the statement.
The committee decided to establish a working group comprising representatives from the FBR, SBP, IT Ministry, P@SHA, and the Freelancers Association.
“The group will focus on harmonizing data, identifying significant issues, simplifying processes, enhancing transparency, and ensuring continuity of progress made by SBP and other stakeholders,” read the statement.
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Finance Minister Aurangzeb urged all stakeholders to work collectively to overcome challenges, promote IT exports, and establish Pakistan as a competitive player in the global IT industry.
Minister of State for IT & Telecom Shaza Fatima Khawaja, Advisor to the Finance Minister Khurram Schehzad, Chairman Federal Board of Revenue (FBR), Governor SBP, CEO Pakistan Software Export Board (PSEB) and senior officials from the Finance Division and IT Ministry attended the meeting.
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