A payment from a client in Dubai, London or New York should be routine. In practice, payments get delayed, recorded under the wrong purpose or converted at a bad moment. This guide explains how foreign payments reach a Pakistani bank account, the account types that State Bank of Pakistan (SBP) rules provide for IT exporters and freelancers, and the paperwork that keeps your income traceable for tax and PSEB purposes.
This is general information, not legal or tax advice. SBP rules change, so confirm current terms with your bank.
How a foreign payment reaches you
Payments for services usually arrive in one of three ways:
- A direct bank transfer from your client’s bank to your bank in Pakistan.
- An international payment platform that collects from your client and pays out to your Pakistani bank account.
- A marketplace, such as a freelancing platform or app store, that pays out through one of the routes above.
Whichever route you use, the money ends up with a bank in Pakistan, called an Authorized Dealer in SBP’s rules. That bank credits the funds, reports the transaction and gives you proof of receipt. Your job is to make sure the bank records the payment correctly and that you keep that proof.
Account types under SBP rules
A PKR account plus an ESFCA
SBP’s Foreign Exchange Manual has specific rules for IT companies and freelancers. As of 2026:
- It defines IT companies as entities registered with PSEB or P@SHA, and freelancers as Pakistan-resident individuals who provide digital or online services and are paid from outside Pakistan.
- Banks open an Exporters’ Special Foreign Currency Account (ESFCA) at the same time as your main PKR account.
- IT companies and freelancers can retain USD 5,000 per month or 50% of export proceeds in the ESFCA, whichever is higher.
- You can convert ESFCA funds into rupees at any time on request.
- IT companies can make current-account payments abroad for their own business, and freelancers can make personal and work-related current-account payments, without prior SBP approval.
- Banks may issue a debit card on the ESFCA, but cash withdrawal inside Pakistan is not allowed, and you cannot move the balance to other foreign currency accounts.
The same chapter lets exporters of other services, not covered by the IT rules, retain 35% of their net foreign exchange earnings in an ESFCA.
Freelancer accounts
SBP’s Framework for Freelancers Accounts (BPRD Circular No. 05 of 2023) lets banks open accounts for freelancers in person or remotely through digital means, with an ESFCA alongside a primary PKR account. Ask your bank whether it offers a freelancer account and which documents it needs.
The 2026 changes to Form “R”
On 6 April 2026, SBP announced new measures for IT exporters and freelancers:
- IT companies and freelancers no longer need to submit Form “R” for every individual export transaction. Instead, they make a one-time declaration of the services they provide abroad, at account opening or when the bank asks existing customers.
- The threshold for obtaining Form “R” rose to above US$25,000, or the equivalent in other currencies.
- Banks must process inward export receipts, and outward remittances from ESFCAs, within one working day at most.
- Banks were told to standardise documents for outward ESFCA payments, set up systems to resolve complaints on time, and digitise Forms “R” and “M”.
If your bank asks for paperwork that seems out of line with these measures, ask it which instruction it is following.
Your proof of income: the PRC
A Proceeds Realization Certificate (PRC) is documentary proof that funds were received from abroad and realised in Pakistan. SBP directed banks to issue PRCs electronically, and the recipient can obtain one once funds are credited. SBP says agencies such as FBR, Pakistan Customs and SBP can verify PRCs through banks’ online portals.
Why it matters:
- It links each foreign payment to your account and a date.
- Your tax adviser may need PRCs to support how your export income is treated.
- PSEB renewal asks for an export revenue summary using SBP’s IT/ITeS code, so the bank’s coding of your receipts matters.
Download your e-PRCs every month and file each one with its matching invoice.
Documentation that keeps payments clean
SBP’s rules let IT companies provide an export agreement, invoice or similar document, preferably in electronic form. Freelancers without contracts can give a one-time self-declaration at account opening. Good records go further than the minimum:
- A signed contract or accepted proposal for each client.
- A numbered invoice for each payment, in the currency you bill, with a clear description of the service.
- The payment confirmation from the client or platform.
- The bank’s credit advice and the e-PRC.
- A monthly reconciliation of the amount invoiced, fees deducted and rupees credited.
Use the same service description everywhere. If your contract says “software development services”, your invoice and bank declaration should say the same.
Practical tips
- Receive money in the right name. If your company issues the invoice, the money should land in the company’s account, not a founder’s personal account.
- Ask how receipts are coded. If the payment is for services you exported, ask your bank to confirm it is recorded that way and not as a personal home remittance.
- Plan conversions. If you retain dollars in an ESFCA, decide when to convert based on your rupee costs, not on guesses about the exchange rate.
- Track fees. Platform and bank charges reduce what you receive. Record the gross amount invoiced and the net amount credited.
- Watch for updates. SBP has changed its IT export rules several times since 2023. Check SBP’s circulars, or ask your relationship manager, every few months.
Checklist
- Register with FBR and, for IT work, consider PSEB registration.
- Open a PKR account with an ESFCA, or a freelancer account, in the right name.
- Give your bank the one-time declaration of services.
- Invoice every client with a number and a clear description.
- Download e-PRCs monthly and match them to invoices.
- Reconcile amounts invoiced, fees and rupees credited each month.
- Review your retention and conversion plan every quarter.
Sources and further reading
- SBP Foreign Exchange Manual, Chapter 12: Exports
- SBP Foreign Exchange Manual, Chapter 10: Inward and outward remittances
- SBP EPD Circular Letter No. 17 of 2023: Export of software, IT, ITeS and freelance services
- SBP BPRD Circular No. 05 of 2023: Framework for Freelancers Accounts
- SBP press release, 6 April 2026: measures to facilitate IT exporters and freelancers
- SBP press release, 6 August 2022: electronic Proceeds Realization Certificates
- PSEB: Company registration and renewal requirements
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