Roshan Digital Account Investments in Mutual Funds Soar Among Overseas Pakistanis

Overseas Pakistanis have significantly increased their investments in mutual funds through the Roshan Digital Account (RDA), with a notable rise to Rs4.026 billion as of March 2024, marking a nearly 100% increase from the previous year. This surge, highlighted by the Mutual Funds Association of Pakistan (MUFAP), reflects a 96.5% growth in investments in asset management firms between March 2023 and March 2024, from a total of Rs2.049 billion.
The increase in investments from non-resident Pakistanis (NRPs) is attributed to the higher returns offered by various asset management companies and an efficient digital process for investing and disinvesting. The RDA facilitates NRPs to invest in a diverse portfolio including stocks, fixed income, money market, commodities, and real estate, although investments in mutual funds through RDA remain smaller compared to other channels like the stock market and Naya Pakistan Certificates.
According to the State Bank of Pakistan (SBP), RDA inflows reached $7.831 billion between September 2020 and April 2024, with $4.925 billion utilized locally and $1.587 billion repatriated, leaving a net repatriable liability of $1.320 billion. Investments through RDA during this period totaled $873 million, including $317 million in conventional Naya Pakistan Certificates (NPCs), $523 million in Islamic NPCs, and $33 million in the stock market.
Additionally, the mutual fund industry’s assets under management (AUM) increased to Rs2.410 trillion by March 2024, a 1.15% growth from the previous month. Money market assets under management rose by 3.37% to Rs1.199 trillion, and equity AUM grew by 1.20% to Rs181 billion, driven primarily by elevated interest rates and a strong performance of the stock market following Pakistan’s $3 billion bailout package from the IMF in July.