Exchange firms have proposed that the federal government cover the cost of creating letters of credit (LCs), as numerous industries suffer as a result of banks’ inability to do so due to a lack of dollars.
Exchange Companies Association General Secretary Zafar Paracha noted in a statement that many industries are coping with major issues as a complete result of banking institutions’ refusal to open LCs. Due to a lack of dollars, banks are refusing to lend money, which causes a variety of sectors to suffer.
According to Paracha, exchange organizations are ready to assist the nationwide government by offering cash for the opening of LCs. He asserted that exchange organizations may provide LCs for up to $50,000.
He claimed that the pressing problem had just been discussed with Finance Minister Ishaq Dar and was awaiting an answer from the administration.
By Paracha, exchange businesses could provide financing for imports totaling as much as $250 million within the month that is upcoming.
The open market, which is considerably higher compared to the interbank rate, will be used for the funding, he emphasized.
The proposition comes as the administration is apparently struggling to keep the nation’s foreign exchange reserves, which have reportedly fallen to under $5 billion.
