Money and banking drive economic activity by facilitating transactions, savings, and investments. Banks manage financial resources, offer credit, and regulate money supply, ensuring stability and growth in Pakistan’s financial sector.
KARACHI: The State Bank of Pakistan (SBP) on Saturday said it hosed an interactive session on March 03, 2022 on the topic ‘The Promise of Digital Banks’ for domestic and international stakeholders.
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KARACHI: The Pak Rupee (PKR) gained 33 paisas against the dollar on Friday after depreciation for past three trading sessions.
(more…)KARACHI: The US dollar on Thursday gained 21 paisas against the Pak Rupee (PKR) as international oil prices surged to eight years high.
The rupee ended at Rs177.83 to the dollar from previous day’s closing of Rs177.62 in the interbank foreign exchange market.
READ MORE: Dollar surges 21 paisas to PKR on high oil price concerns
The international oil prices recorded gradual increase following Russian supply concerns after war with Ukraine. The benchmark Brent crude recorded 8-year high at $119 per barrel.
Currency experts said dollar demand for oil payment may further rise in coming days. The local unit fell to historic low at Rs178.24 against the dollar on December 29, 2021.
READ MORE: Dollar eases by six paisas to PKR
The import bill of petroleum group recorded an increase of 107 per cent to $11.7 billion during first seven months of the current fiscal year as compared with $5.64 billion in the corresponding months of the last fiscal year.
The surge in dollar demand for import bill will further weaken balance of payment as current account deficit already touched record in January 2022.
READ MORE: Rupee dips 36 paisas to dollar in interbank
The country’s Current Account Deficit (CAD) surged to its highest ever monthly deficit of $2.6 billion in January 2022 ($1.9 billion in December 2021) taking CAD of $11.6 billion during the first seven months of the current fiscal year.
KARACHI: The State Bank of Pakistan (SBP) has issued standards for Quick Response (QR) code based payments in the country to accelerate digitization of retail payments, a statement said on Wednesday.
These standards are to be met for issuing of QR codes and accepting of payments through the same. This initiative is a part of SBP’s drive to promote inclusion, innovation, and modernization of payment systems in the country.
READ MORE: Pakistan’s e-banking registers sharp increase in 1QFY22
The development and issuance of a single QR code was earlier announced by Governor State Bank of Pakistan, Dr. Reza Baqir, while chairing the 5th Stakeholders consultation meeting on Digital Financial Services in August 2021. With the issuance of a single country wide QR code standard Pakistan joins the list of countries who have taken similar steps to promote low cost digitization of payment services, especially at retail level.
QR Code based payments are increasingly becoming popular around the world for being low cost and easy to use via mobile applications. However, in Pakistan, QR codes that are being issued by financial institutions are not usually based on common industry standard and had limited interoperability due to which their acceptance and usage in the country is very low.
READ MORE: SBP imposes Rs1.45 billion penalty on 18 banks in 2021
Accordingly, the common QR code standards have been developed by an industry consultative group, formed by SBP, and is based on EMVCo’s QR Code Specifications for merchant payments. EMVCo is a global technical body that facilitates worldwide interoperability and acceptance of secure payment transactions by managing and evolving the EMV Specifications and related testing processes. The Standards are designed to be flexible to adapt to new and innovative use-cases, with data objects allocated for scheme, acquirers and SBP for future use.
To facilitate the issuance and adoption of QR code based payments, SBP has issued its two variations: one for person to person payments and other for person to merchant payments. The Person to Person (P2P) standard would be used by banks and financial institutions to generate personalized QR codes for their customers, using which they would be able to receive payments on their mobile apps.
READ MORE: SBP imposes penalty of Rs58 million on five banks
Similarly, the Person to Merchant standard would be used for accepting and processing merchant based payments, using mobile apps, on lines similar to card based payment acceptance.
All financial institutions offering digital payment services would be required to comply with the new requirements and ensure that mobile apps of all banks and other payment institutions in Pakistan are able to scan and process any QR code that is issued as per the new standard not later than 30th June 2022.
READ MORE: SBP slaps Rs280 million penalty on National Bank
The Standards also promote the establishment of domestic payment schemes, which will provide an efficient and cost-effective payment alternate to the citizens of Pakistan. Further, it will enable a fully interoperable mechanism for QR issuance with embedded information of multiple payment schemes within a single QR code, allowing the customer to choose from a range of available schemes. This will result in eliminating or reducing the number of multiple QR Codes at the merchant locations. It may be mentioned that SBP has also recently launched the person-to-person (P2P) version of its instant payment system, Raast which will offer a fully interoperable payment mechanism for QR based payments as well.
With the issuance of the standard QR code guidelines, State Bank aims to further enhance the availability and promote use of low-cost digital payment acceptance points (ie. QR Codes) across the country. The new QR Code standard would simplify customer experience for paying or accepting digital payments in their daily lives such as for grocery shopping, school fee payments, bill payments, online shopping, ride hailing services, besides enabling P2P Fund transfers i.e. fund transfers between individuals.
KARACHI: On Wednesday, the US dollar gained 21 paisas against the Pakistani Rupee (PKR) in response to soaring international oil prices, which surpassed $113 per barrel.
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ISLAMABAD: The President of Pakistan, Dr. Arif Alvi has directed the Bank of Punjab to refund money to a family of a deceased person, which was recovered unfairly.
President Dr. Arif Alvi upheld a decision of the Banking Mohtasib of Pakistan (BMP) ordering the Bank of Punjab to refund an amount of Rs 423,556 to the family of a deceased borrower which the Bank had unilaterally and unfairly recovered from the family.
READ MORE: President Alvi rejects FBR plea in maladministration cases
The President observed that the bank unnecessarily complicated a routine matter as its own SOPs empowered it to give financial relief in such cases.
Late Mian Allah Wasaya had availed a loan of Rs 3 million in 2015 from the Bank of Punjab and deposited Regular Income Certificates (RICs) issued by the Central Directorate of National Savings, valuing Rs 3.5 million, as Liquid Security with the Bank.
On January 27, 2017, he passed away, and the Bank on its own encashed the RICs then worth Rs 4.155 million and charged a mark-up of Rs 480,489 till October 22, 2018, while the accumulated mark-up at the time of Wasaya’s death was only Rs 57,294.
READ MORE: Dr. Alvi orders action over misconduct with 82-year taxpayer
The widow of Allah Wasaya (the complainant) requested the bank to charge mark-up till the period her husband was alive and waive off the mark-up thereafter.
The Bank, however, did not accede to her request after which she approached the Banking Mohtasib for redressal of her grievance.
After hearing the case and perusing the available record, the Banking Mohtasib noted that at the time of death the principal outstanding amount was Rs 2.889 million and the accumulated mark-up was Rs 57,294 only.
In the given circumstances, it was the fiduciary responsibility of the bank to guide the legal heirs for adjustment of outstanding liability at this level against encashment of RICs, the BMP observed.
READ MORE: Dr. Alvi rejects banker’s plea in woman harassment case
It further noted that instead of exercising its statutory obligation to set off the loan against liquid security, the bank continued to linger on recovery and unnecessarily piled-up mark-up on the principal outstanding amount which was unfair as per the State Bank’s guidelines.
The Mohtasib termed the claim of the bank as absurd and unprofessional that the matter pertained to the year 2018 and its books have been closed, therefore, it was not in a position to provide financial relief.
It added that no rule, regulations, law, or accountant standard was referred which barred the bank to revisit the old/closed cases as such types of transactions were a routine matter.
The Ombudsman held that unilaterally charging and recovering mark-up without justification beyond Rs 57,294 was an injustice to the deceased borrower’s family.
READ MORE: Alvi praises FTO role in resolving taxpayers’ complaints
It ordered that the Bank had committed maladministration and malpractice by not exercising its rights without any valid reason even though holding fully cashable liquid security under the loan agreement documents and piling up mark-up liability unnecessarily.
The Bank, subsequently, filed a representation against this decision of the BMP with the President. The President upheld Mohtasib’s decision and held that Bank had not provided any justification to upset the original order of the BMP.
The representation is rejected as it is devoid of any merit and the bank had failed to discharge the burden and statutory liability cast upon it under the law, the President noted in his decision.
KARACHI: The US dollar eased by six paisas against the Pak Rupee (PKR) on Tuesday due to foreign inflows seen during the day.
The rupee ended at Rs177.41 to the dollar from previous day’s closing of Rs177.47 in the interbank foreign exchange market.
READ MORE: Rupee dips 36 paisas to dollar in interbank
Currency experts said that inflows in the shape of export receipts and foreign remittances were also seen during the day. They however said that rising oil prices in the international markets may put pressure on the local currency.
The oil prices in the international markets remained volatile since Russia launched attacks on Ukraine.
Pakistan is one of the major importers of petroleum products. The import bill of petroleum group recorded an increase of 107 per cent to $11.7 billion during first seven months of the current fiscal year as compared with $5.64 billion in the corresponding months of the last fiscal year.
READ MORE: Rupee plunges 72 paisas to dollar on Russia War
Due to rising import payments, the current account deficit of the country is also widening. The Current Account Deficit (CAD) widened to its highest ever monthly deficit of $2.6 billion in January 2022 ($1.9 billion in December 2021) taking CAD of $11.6 billion during the first seven months of the current fiscal year.
READ MORE: PKR slides 23 paisas to dollar on Russia-Ukraine war
The external payments also depleting foreign exchange reserves. The liquid foreign exchange reserves of Pakistan declined by $264 million to $23.226 billion by the week ended February 18, 2022. The foreign exchange reserves of the country were $23.49 billion by the week ended February 11, 2022. The official reserves of the State Bank fell by $289 million to $16.807 billion by the week ended February 18, 2022 as compared with $17.096 billion a week ago.
KARACHI: Pakistan’s e-banking registered sharp growth in the first quarter of the fiscal year 2021/2022, the central bank said on Monday.
E-banking—defined as transactions conducted via electronic channels (including Real-time Online Branches, ATMs, mobile banking, internet banking, call center banking, POS and e-Commerce), continued to thrive in both volume and value during the quarter under review as it grew by 12 per cent and 16 per cent respectively in Q1-FY22 over the same quarter of FY21.
The State Bank of Pakistan (SBP) released its first quarterly report of payment systems for the fiscal year 2021-22 today covering the period July – September, 2021. The report shows that Pakistan’s payment ecosystem, especially though digital platforms, continued its brisk pace of growth.
READ MORE: SBP imposes Rs1.45 billion penalty on 18 banks in 2021
Two major areas where high adoption in digital payments were witnessed are mobile and internet banking. The number of mobile banking users grew by 4 per cent on quarter over quarter (QoQ) basis, reaching a total of 11.3 million.
The number of transactions conducted via mobile banking channels was 79.1 million with a value of around PKR 2.2 trillion, showing a QoQ growth of 29 per cent by volume and 36 per cent by value. Internet banking also contributed to the upswing in usage of e-Banking services by registering 31 per cent QoQ growth in internet banking users who conducted 30 million transactions amounting to PKR 1.9 trillion. This amounts to 6 per cent progress in terms of volume and 10 per cent increase in the value of these transactions on QoQ basis.
READ MORE: SBP imposes penalty of Rs58 million on five banks
Retail sector continued to show adoption of digital payments. Overall e-Commerce transactions recorded an impressive QoQ growth of 87 per cent by volume and 21 per cent by value, though the number of e-commerce merchants remained almost the same as of the last quarter.
During the quarter, 12.7 million ecommerce related transactions amounting to Rs22.3 billion were conducted using digital payment channels. Similarly, the number of merchant Point of Sale (POS) machines also increased by 10 per cent QoQ reaching to 79,134 machines in the country.
These machines processed 28.1 million card-based transactions at merchant locations amounting to almost PKR 134.9 billion which showed QoQ increase of 16.1 per cent by volume and 10.6 per cent by value.
READ MORE: SBP slaps Rs280 million penalty on National Bank
As of end-September 2021, there were 46.2 million total cards in circulation which mainly comprised of Debit Cards (64 per cent), Social Welfare Cards (22 per cent), ATM only Cards (10 per cent), Credit Cards (4 per cent), and Prepaid Cards (0.3 per cent). During this quarter, QoQ increase of 5 per cent in volume of paper-based transactions and 3 per cent increase in value of paper-based transactions was also observed which may be attributed to people returning to traditional channels (i.e. branches) as pandemic related restrictions were lifted.
In Large-value (wholesale) payments segment, transactions processed, during this quarter, through SBP’s Real-time Inter-Bank Settlement Mechanism (PRISM) recorded a total of 1.1 million transactions amounting to PKR 159.1 trillion which is 7 per cent higher than the preceding quarter.
READ MORE: National Bank under grip of regulatory violations
KARACHI: The Pak Rupee (PKR) dipped by 36 paisas against the dollar on Monday owing to higher demand for import payments as the market opened after two weekly holidays.
The rupee ended Rs177.47 to the dollar from last Friday’s closing of Rs177.11 in the interbank foreign exchange market.
READ MORE: Rupee plunges 72 paisas to dollar on Russia War
The rupee depreciated by around Rs1.09 against the dollar during last three trading sessions.
Currency experts said that the rupee witnessed a decline since Russia launched attack on Ukraine and resultantly oil prices climbing up in the international markets.
Pakistan is a major importer of petroleum products, the impact is directly seen on the rupee value.
Besides, the impact of high oil prices and the ballooning current account deficit also pressured the rupee during the day.
READ MORE: PKR slides 23 paisas to dollar on Russia-Ukraine war
The country’s Current Account Deficit (CAD) surged to its highest ever monthly deficit of $2.6 billion in January 2022 ($1.9 billion in December 2021) taking CAD of $11.6 billion during the first seven months of the current fiscal year.
The rupee was also falling due to ease in foreign exchange reserves of the country.
READ MORE: PKR gains seven paisas to dollar in interbank
The liquid foreign exchange reserves of Pakistan declined by $264 million to $23.226 billion by the week ended February 18, 2022. The foreign exchange reserves of the country were $23.49 billion by the week ended February 11, 2022. The official reserves of the State Bank fell by $289 million to $16.807 billion by the week ended February 18, 2022 as compared with $17.096 billion a week ago.
KARACHI: The State Bank of Pakistan (SBP) has relaxed financing conditions for housing units in under construction projects.
The central bank issued a circular dated February 25, 2022 to ease the conditions for house financing. It said that in order to further facilitate buyers of housing units in under construction projects, requirement of builder/developer to avail construction financing is being relaxed.
READ MORE: Bank Alfalah tops in house financing under MPMG
“Accordingly, purchasers of housing units in under construction projects may avail housing finance against their housing units in projects where builder/developer has not availed construction financing,” the SBP said.
In such cases, the builder/developer will have to create mortgage charge over project’s land in favor of bank/DFI through an agreement. The charge will only be vacated after completion of the project and transfer of housing units to the purchasers. Moreover, the builder/developer will comply with all other provisions of subject guidelines, it added.
Any bank/DFI can provide housing finance to a purchaser of a housing unit in such under construction projects.
READ MORE: SBP launches webpage for promoting house financing
However, if the purchaser wants to avail financing from a bank/DFI other than the mortgagee bank/DFI, then it will have to obtain NOC from the mortgagee bank/DFI in this regard.
Moreover, financing bank/DFI of such purchasers will also be required to enter into bilateral arrangement with the mortgagee bank/DFI to secure its risk.
With regard to the requirement of informed consent under guidelines, it is clarified that the builder/developer will be responsible to arrange written informed consent from the customers who intend to purchase housing units from their own sources without availing mortgage finance.
The letters of written consent of such purchasers will be submitted to the bank/DFI in original by the builder/developer.
The builders/developers are developing and marketing a number of multi-storey projects of housing units across the country. Although these under construction projects are exposed to project completion risk and performance risk of builders/developers, many individuals are attracted to book housing units in these projects owing to their affordability and option of payments through installments.
However, the banks/DFIs have traditionally shied away from financing to the housing units in under construction projects due to issues in availability of legally enforceable title documents and registration of mortgages as per requirements of Prudential Regulations (PR) for Housing Finance.
It may be noted that banks/DFIs extend project financing to builders/developers for construction of multistorey housing projects after adequately securing their project and builder risks through mortgage of project land and other securities. Utilizing these already established security arrangements with the builders/developers, the banks/DFIs may also extend housing finance against housing units in multistorey housing projects. This will expand options of affordable housing to the individual borrowers. This will also facilitate banks/DFIs in ensuring repayment/ settlement of their project financing through conversion of the same in housing finance.