SBP allows transfer of up to $200,000 as payment for foreign digital services

The State Bank of Pakistan (SBP) has allowed banks to release a maximum amount of $200,000 per year as payment for digital services provided by foreign companies.

In order to ease of doing business in the country, the central bank on Thursday issued a new mechanism for payments to globally recognised digital service provider companies against the acquisition of digital services by local companies.

The SBP amended Foreign Exchange Manual and allowed general permission to banks to release foreign exchange up to a maximum of $200,000, or equivalent in other currencies, per year, for each company/ firm/ sole proprietorship incorporated/established in Pakistan on account of commercial payments, pertaining to digital services, in favour of digital service provider companies.

The release of payment is limited to foreign companies listed by the SBP, including Adobe,
Affinity, Airtable, Alibaba Group, Amazon, Apple, AppLovin, Asana, Atlassian, Box, Calendly,
Coursera, Digital Ocean, DocSend, DocuSign, Dropbox, Expensify, Facebook, Figma, FreshBooks, Front, GoDaddy, Google, Hootsuite, Hubspot, IBM, Instagram, Intercom, InVision, LinkedIn Corporation, Mailchimp, Marketo, Mendix, Microsoft Corporation, Optimizely, Oracle Corporation, Pilot, Pipe Drive, Poynt, Intuit/QuickBooks, Red Hat/OpenShift, Sketch, Salesforce, SAP SE/SAP, SEMrush, Shopify, Slack Technologies/Slack, Squarespace, Tencent, Trello, Twilio, Twitter, Udacity, Udemy, VMware, WhatsApp, WordPress, Xero, YouTube, Zapier, Zendesk and Zoom/Video Communications.

The SBP said that the ultimate beneficiary of remittances should only be the company (including their affiliates or associated entities).

However, up to a maximum amount of $25,000, out of the total annual limit of $200,000, can be remitted to those digital service provider companies which are not listed in the Appendix V 147, against the acquisition of digital services.

The remittances should only be made by an authorized dealer designated by the remitter for this purpose under acknowledgement to Foreign Exchange Operations Department (FEOD) SBP-BSC. No authorized dealer will remit funds under this general permission unless it has been acknowledged as designated authorized dealer by the FEOD SBP-BSC.

The SBP said that the banks will ensure that it has satisfied itself with the genuineness and bonafides of the applicant, through appropriate CDD and customer risk profiling, specifically in light of AML/CFT regulations.