Dollar Deposits Rise in Pakistani Banks Despite SBP Restrictions
Deposits of US dollars in Pakistan’s banking system have increased significantly during the first nine months of FY26, reflecting continued demand for foreign currency despite regulatory measures.
According to recent data, dollar deposits reached Rs. 87 billion during this period, compared to a net withdrawal of Rs. 9 billion in the same timeframe last year—indicating a notable shift back toward formal banking channels.
Continued Demand for Foreign Currency
The rise comes despite tighter controls introduced by the State Bank of Pakistan to manage foreign exchange reserves and regulate currency movement.
While these measures were aimed at limiting outflows, the latest figures suggest that demand for the US dollar remains strong among individuals and businesses.
Shift From Informal to Formal Channels
Last year, a portion of foreign currency purchases was reportedly used for digital asset trading rather than being deposited in banks, which contributed to lower official deposit levels.
However, with the introduction of new regulatory measures under the Virtual Assets Act 2026, the use of foreign currency for such activities appears to have declined. This has led to a greater share of dollars being held within the formal banking system.
Restrictions on Dollar Access
Access to foreign currency has also become more controlled. Exchange companies are now required in many cases to provide rupee payments through cheques instead of cash.
In addition, individuals face limits on dollar purchases, including a cap of $950 per identity card and up to $2,000 annually.
Role of Foreign Currency Accounts
Foreign currency accounts continue to serve as an important option for residents seeking to hold US dollars for savings, international transactions, or as a hedge against currency fluctuations.
