SBP cancels Dream Exchange license over violations
SBP revokes Dream Exchange licence, halting all forex operations as regulator tightens oversight of exchange companies amid compliance concerns.
The State Bank of Pakistan has cancelled the license of M/s Dream Exchange (Private) Limited with immediate effect after finding serious violations of regulatory instructions, the central bank said on Tuesday.
The decision bars Dream Exchange, including its head office and all branches, from conducting any form of foreign exchange business. The SBP said the revocation means the company can no longer deal in foreign currency transactions in any capacity under Pakistan’s regulatory framework.
Read More: Satellite firms warn license delays risk investment
The move comes as part of the SBP’s broader push to enforce stricter compliance standards across the exchange companies sector. The regulator has increased scrutiny in recent years to curb irregularities, improve documentation, and ensure transparency in currency markets.
Pakistan’s exchange companies play a critical role in managing remittance inflows and currency liquidity. According to SBP data, workers’ remittances reached around $30 bn in fiscal year 2025, forming a key pillar of the country’s external account stability. A significant portion of these flows passes through regulated exchange companies alongside banking channels.
The SBP has introduced structural reforms in the sector since 2023, including raising minimum capital requirements and encouraging consolidation among smaller operators. These measures aim to strengthen governance and reduce the risk of money laundering and undocumented transactions, in line with commitments under the Financial Action Task Force framework.
In 2024, the central bank also directed exchange companies to adopt stricter know-your-customer protocols and improve reporting standards. Industry data suggests that the number of licensed exchange companies has declined as weaker entities either exited or merged to meet new compliance thresholds.
The cancellation of Dream Exchange’s license signals continued zero tolerance for regulatory breaches. While the SBP did not disclose specific violations, such actions typically relate to non-compliance with anti-money laundering rules, unauthorized transactions, or failure to meet operational guidelines.
Pakistan’s foreign exchange market has remained under pressure due to external financing constraints and currency volatility. The Pakistani rupee has experienced fluctuations in recent years, prompting authorities to tighten oversight of both interbank and open market currency trading.
According to the SBP’s latest monetary policy statement, maintaining exchange rate stability and curbing speculative activity remain key policy priorities. The regulator has repeatedly warned exchange companies against malpractice, including hoarding of foreign currency and manipulation of rates.
Analysts say enforcement actions such as license cancellations are intended to reinforce market discipline and restore confidence in formal channels. The government has also been encouraging overseas Pakistanis to use official remittance systems, which offer better transparency and support foreign exchange reserves.
The exchange companies sector has undergone a transition toward greater formalization, with digital reporting and closer monitoring by regulators. This shift aligns with Pakistan’s broader financial sector reforms aimed at improving compliance and attracting international confidence.
The SBP said it will continue to monitor the sector closely and take necessary action against entities that fail to meet regulatory standards. The central bank reiterated that protecting the integrity of the financial system remains a top priority.
The latest enforcement action underscores the SBP’s ongoing efforts to strengthen oversight of exchange companies like Dream Exchange as Pakistan navigates external account challenges and works to stabilize its foreign exchange market.