KARACHI: Remittances sent by overseas Pakistanis have remained robust despite the rationalization⁢ of incentives for banks ⁣and exchange companies. According to the State Bank of ⁤Pakistan (SBP),remittance inflows in the ⁣first two months of ⁣Fiscal Year 2026 (FY26) rose by 7 percent,defying expectations that a reduction in incentives would negatively ⁢impact inflows.

Saudi ⁢Arabia continues to be the largest contributor to Pakistan’s remittance inflows, sending $1.24 billion during the period. This represents a decrease of 9.6 percent compared to⁣ the same period last year. However, inflows from other Gulf Cooperation Council (GCC) countries reached $600 million, ‍showing a growth of 5.3 percent.

Remittances from the United Kingdom and the United States experienced declines. ‍The UK sent $913.7 million, down 0.5 percent, while ⁣the US sent $537 million, a decrease of 13.7 ⁣percent.Conversely, remittances from the European ‍Union⁢ (EU) continued their upward trend, increasing by ⁣18 percent to $857 million in the first two months of FY26.

financial experts emphasize the need for remittances to remain strong throughout FY26 to maintain a current account surplus and preserve the stability of the exchange rate. A stable exchange rate is vital for controlling inflation‍ and managing external‍ debt.