The State Bank of Pakistan (SBP) has reduced the rate of remuneration on the Special Cash Reserve Account (US$) to 2.67% for February 2026, compared with 2.69% in January 2026 and 2.86% in December 2025, according to a circular issued by the central bank.
The revised rate applies to deposits mobilised under FE-Circular 25 of 1998. Under the prevailing regulatory framework, banks and non-bank financial institutions (NBFIs) are required to maintain cash reserves equivalent to 25% of their total FE-25 deposits with the SBP. Of this amount, 5% is kept in a Cash Reserve Account, while the remaining 20% is placed in a Special Cash Reserve Account.
While the Cash Reserve Account does not earn any return, the Special Cash Reserve Account is remunerated on a monthly basis at a rate notified by the SBP.
As outlined in DMMD Circular Letter No. 03 of 2023, the remuneration rate is calculated using the CME one-month Term Secured Overnight Financing Rate (SOFR) published on the last working day of the preceding month, after deducting a 1% service charge.
The latest adjustment reflects the SBP’s established mechanism for aligning the return on foreign currency reserves maintained by banks and NBFIs with prevailing international benchmark rates, ensuring consistency with global market conditions.
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