Pakistan’s banking industry says a new government policy shifting the cost of handling workers remittances to banks will add financial pressure and may impact profitability.
The Pakistan Banks Association (PBA) said on Saturday that banks will now cover the cost of bringing remittances into the country starting July 1, 2026. Previously, the government subsidized these expenses to keep remittance transfers free for both senders and recipients.
The State Bank of Pakistan (SBP) said the cost of attracting remittances reached about Rs76 billion in the fiscal year ending June 30, 2026. Officials expect this cost to rise to Rs85 to 90 billion in fiscal year 2026–27 as inflows continue to grow.
Pakistan is projected to receive more than $41.5 billion in workers remittances in FY26. That number is expected to increase to about $44 billion in FY27.
PBA executive committee member and Bank Alfalah CEO Atif Bajwa said the new policy places an extra burden on banks and could affect earnings. He spoke at a press briefing in Karachi ahead of the Pakistan Banking Summit 2026.
He said banks will manage the impact while continuing to support growth in remittances. He also said strong remittance inflows remain vital for Pakistan’s economy.
State Bank Governor Jameel Ahmad said remittances will remain free for senders and recipients. He said banks can manage costs by balancing revenue from other services.
He described remittances as a key support for the economy and said banks will continue to compete to attract inflows from overseas workers.
Pakistan Banks Association Chairman Zafar Masud said banks are working on solutions to handle the new cost structure. He said the banking sector remains committed to maintaining growth in remittances in the coming years.
He added that banks did not directly benefit from earlier subsidy schemes, as those programs mainly supported customers.
Despite concerns over costs, bank officials expect remittances to keep rising due to strong demand and competition among financial institutions.
Separately, the PBA said the Pakistan Banking Summit 2026 will bring together international speakers from several countries, including the United States, United Kingdom, Singapore, and others.
The summit will focus on topics such as small and medium sized business financing, agriculture, low cost housing, and broader development of Pakistan’s banking sector.
