KARACHI: The State Bank of Pakistan (SBP) has, with immediate effect, cancelled the authorisation/license of Time Exchange Company (Pvt) Limited due to serious violations of the central bank’s regulatory instructions, it said in a statement on Monday.
Consequently, Time Exchange Company (Pvt.) Limited, including its head office and all constituent branches, is hereby prohibited from undertaking any foreign exchange-related business activities in any capacity whatsoever, it added.
Analysts said the closure of exchange firms could create more opportunities for bank-owned exchange companies. Last week, BankIslami launched its wholly owned currency exchange subsidiary.
In 2023, the SBP implemented major structural reforms in the exchange companies sector to enhance transparency, governance and compliance. These reforms include increasing the minimum capital requirement from Rs200 million to Rs500 million, consolidating various categories into a single, well-defined category, and requiring banks to establish their own exchange companies. As a result, some leading banks have created wholly owned exchange firms as subsidiaries.
The SBP also significantly raised the minimum paid-up capital requirement for exchange companies in 2024, further tightening regulations to formalise the currency market. Capital-deficient firms must meet these new requirements through a gradual timeline: Rs800 million by December 31, 2026, and Rs1 billion by the end of December 2027.
