Workers' remittances reach record high of $38.3bn in FY25

July 09, 2025 (MLN): Pakistan’s workers’ remittances reached a record high of $38.3 billion in FY25, marking a 26.6% increase compared to $30.25bn received in the same period of FY24.

Speaking to Mettis Global, Ali Najib said that this sharp rise reflects multiple contributing factors. Firstly, improved global economic conditions in key host countries, particularly in the Gulf region, supported higher income levels for overseas Pakistanis. 

Secondly, the formalization of remittance channels, aided by SBP's incentives under the Pakistan Remittance Initiative (PRI), reduced reliance on informal means such as hundi/hawala, he added.  

Moreover, the relative stability of the rupee and tighter regulation of foreign exchange markets made formal transfers more attractive, he further noted.

The increase also signals rising confidence in Pakistan’s banking system and a shift toward documented financial flows. 

This surge has positively impacted the country’s current account position, supported foreign exchange reserves, and provided crucial support to households dependent on remittance income, thereby playing a significant role in stabilizing macroeconomic fundamentals during FY25.

In June 2025 alone, remittances stood at $3.4bn, according to data released by the State Bank of Pakistan (SBP).

This shows a 7.8% year-on-year increase compared to June 2024, but a 7.5% decline from May 2025.

Remittances inflows during June 2025 were mainly sourced from Saudi Arabia ($823.2 million), United Arab Emirates ($717.2m), United Kingdom ($537.6m) and the United States of America ($281.1m).

Remittances from the European Union saw the highest growth with a 34% increase compared to the previous year. Inflows from the United Arab Emirates and the United Kingdom also rose by 10% year-on-year.

Saudi Arabia, the largest contributor, recorded a modest 2% YoY rise. In contrast, the United States showed a 13% decline, becoming the only major source country with a negative YoY change.

According to data from the Bureau of Emigration & Overseas Employment, over 14.38m Pakistanis have migrated abroad since 1970. 

This large-scale emigration indicated the pivotal role overseas Pakistanis play in supporting the national economy through remittances and international linkages.

Saudi Arabia tops the destination list with 7.39m migrants, followed by the U.A.E at 4.39m, reflecting strong labor migration to Gulf countries.

Other prominent destinations include Oman, Qatar, Kuwait, Bahrain, and Malaysia, illustrating a historical trend of seeking employment across the Middle East and Southeast Asia.

European destinations such as the UK (51,878), Italy (31,602), and Romania (10,132) represent smaller but significant migration flows, often linked to long-term settlement or skilled labor opportunities.

North America has also attracted Pakistani emigrants, with 10,329 to the USA and thousands more across Canada (categorized under “Others”).

In March 2025, workers’ remittances crossed $4.05bn. This surge was attributed to Eid festivities, increased use of formal banking channels, and rising economic activity in the Gulf region, from where the majority of Pakistan’s remittances originate.

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