Overseas Pakistanis sent a record $41.6 billion in remittances during July to June FY26, according to State Bank of Pakistan data released on Thursday. The inflows rose 9% from $38.3 billion in the previous fiscal year. Remittances stood at $3.475 billion in June 2026. They fell 18% from May but rose 2% from June last year. Analysts said the annual increase came from stronger formal banking flows, exchange rate stability and higher overseas employment. Saad Hanif, Head of Research at Ismail Iqbal Securities, said reforms in exchange companies helped shift money away from hawala and hundi channels. “The corridor data reflects this breadth, with UAE up 12%, EU up 15% and others up 20% year-on-year, while incentive schemes provided additional support through the year,” he told Business Recorder. Formal channels support inflows Waqas Ghani, Head of Research at JS Global Capital, said higher overseas employment supported inflows during the year. He also pointed to continued migration toward formal banking channels and stable exchange rate dynamics. Sana Tawfik, Head of Research at Arif Habib Limited, gave a similar view. She said exchange rate stability and a narrow gap between interbank and open market rates encouraged legal transfers. She added that administrative action against illegal channels also helped. A rising number of Pakistani workers abroad also contributed to stronger inflows. Remittances remain vital for Pakistan’s external account. They support household income, foreign exchange reserves and domestic consumption. “The record inflows remain the anchor of Pakistan’s external account, fully absorbing a trade deficit that widened 21.6% year-on-year to $39.5 billion and keeping the current account in surplus,” Hanif said. He added that SBP reserves rose to $18.4 billion from $13 billion a year earlier, despite heavy debt repayments. He said this helped rupee stability and created room for eventual monetary easing. Saudi Arabia leads June inflows Saudi Arabia remained the largest source of remittances in June 2026. Overseas Pakistanis there sent $830 million. The figure was up 1% from June last year but down 19% from May. The UAE sent $792 million in June. That was 10% higher than last year but sharply lower than May. Remittances from the UK stood at $515 million. This was down 20% from May. Pakistanis in the US sent $297 million, showing a 15% monthly decline. EU countries sent $415 million in June. That was down 11% from May. SBP Governor Jameel Ahmad had earlier said remittances would likely cross $41.5 billion in FY26. He also projected inflows of $44 billion in FY27. The outlook now depends on Gulf labour markets, regional tensions and the impact of discontinued incentive schemes. SBP recently ended the telegraphic transfer reimbursement scheme and the Sohni Dharti Remittance Program.
Pakistan Nears $41 Billion Remittance Milestone After Historic May
Pakistan received a record $4.251 billion in workers’ remittances during May 2026, marking the highest monthly inflow in the country’s history and providing a major boost to foreign exchange reserves and economic stability. Data released by the State Bank of Pakistan (SBP) on Wednesday showed remittances rose 20.2% compared to April and increased 15.4% from the same month last year. The strong performance pushed total remittance inflows for the first 11 months of fiscal year 2025-26 to $38.1 billion, up 9.2% from $34.9 billion recorded during the corresponding period a year earlier. The latest figures reinforce the growing importance of overseas Pakistanis in supporting the country’s external account at a time when policymakers continue efforts to strengthen economic recovery and maintain financial stability. Topline Securities attributed the surge primarily to seasonal Eid-related transfers. “The strong growth was primarily driven by Eid-related seasonal inflows, as remittances typically increase during festive periods,” the brokerage house said in a research note. The firm added that total remittances for FY26 are likely to exceed $41 billion, setting another historic milestone. Overseas Pakistanis Drive Historic Surge Pakistan’s average monthly remittance inflow during the first 11 months of FY26 reached $3.5 billion, compared with $3.2 billion during the previous fiscal year. Waqas Ghani, Head of Research at JS Global, said the improvement reflected deeper structural changes rather than temporary factors alone. “This improvement continues to reflect structural factors like higher emigration volumes, sustained shift from hawala to formal banking channels, and relatively stable FX spreads in the interbank market.” He added that regional geopolitical developments may have accelerated remittance flows in recent months. Remittances remain one of Pakistan’s largest sources of foreign exchange and play a critical role in supporting household incomes, domestic consumption and balance-of-payments stability. The government and the central bank have also encouraged overseas Pakistanis to use formal banking channels through various incentive schemes and digital transfer mechanisms. Saudi Arabia and UAE Lead Inflows Saudi Arabia remained the largest source of remittances during May. Pakistanis living in the kingdom sent $1.025 billion, compared with $914 million in the same month last year and $842 million in April. The United Arab Emirates followed closely with remittances reaching $1.007 billion. The amount increased 33% year-on-year and jumped 37% from the previous month. The United Kingdom remained another major contributor, with overseas Pakistanis sending $645 million in May. Remittances from the United States reached $350 million, reflecting a 10% monthly increase from April. Meanwhile, inflows from European Union countries rose to $466 million, up 8% from the previous month. Adviser to the Finance Minister Khurram Schehzad described the achievement as a major vote of confidence in Pakistan’s economy. “This is a resounding testament to the unwavering confidence of overseas Pakistanis, which is further strengthening the country’s economy and external stability,” he wrote on X. “With the last month of the fiscal year, remittances are all set to surpass $41 billion for the first time in history!”
