ISLAMABAD – Pakistan has agreed with the International Monetary Fund (IMF) to close 70 bank accounts of government ministries and attached departments, transferring approximately Rs300 billion to the national treasury as part of ongoing fiscal reforms under the $7 billion loan programme .
The consolidation represents the first phase of a broader effort to centralize public funds into a Treasury Single Account (TSA) maintained at the State Bank of Pakistan. Officials said 242 accounts have already been shifted earlier, bringing nearly Rs200 billion into the national kitty .
The government ultimately plans to close all non-saving accounts of government departments, with total balances of roughly Rs400 billion expected to be transferred to the Federal Consolidated Fund .
The IMF has long pushed for consolidation of government cash holdings, arguing that fragmented banking arrangements allow public entities to hold funds in private accounts earning profits while the government simultaneously borrows from the same banks at much higher interest rates to finance its fiscal deficit .
According to finance ministry officials, the 70 accounts being closed in the first phase are non-interest-bearing accounts maintained by ministries and attached departments. In the second phase, authorities plan to close saving accounts of ministries and divisions, though autonomous bodies that do not rely on federal budget funding may be granted exemptions to preserve their financial independence .
The Senate Standing Committee on Finance has also raised concerns, noting that nearly 200 public sector entities and regulatory bodies are holding over Rs1 trillion in private bank accounts, potentially violating the Public Finance Management Act 2019 .
As part of the same agreement, Pakistan has committed to extending the average maturity period of domestic debt to four years and two months by June 2027 to reduce refinancing risks . The finance ministry is now preparing a formal framework with timelines to close accounts and shift balances under existing legal provisions .
