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Category: Money & Banking

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.

  • National Savings to issue registered prize bonds in all denominations

    National Savings to issue registered prize bonds in all denominations

    ISLAMABAD: The Central Directorate of National Savings (CDNS) to issue scripless registered prize bonds amongst all denominations with objective to document the economy.

    Economic Survey 2018/2019 released by the finance ministry of Monday, said that in collaboration with SBP, National Savings is in the process of introduction of registered scripless prize bonds amongst all denominations.

    The registered prize bonds will be a step towards documentation of the economy while providing facility to the general public.

    The CDNS remained in the process of restructuring and transformation in the Fiscal Year 2019. In this regard, the achievements made in the first nine months and initiatives in the pipeline are as under:

    IT Transformation:

    Starting from 2002-03, National Savings has gone a long way towards computerization and automation of its processes.

    Out of 375 National Savings Centers (NSCs), 222 have been computerized. In the last one year, some more milestones have been achieved for transformation of the organization into an Information Technology enabled entity.

    i. A data center has been established at National Telecommunication Corporation (NTC) and now 205 NSCs are connected to centralized location through Wide Area Network (WAN) whereas NTC is working for provisioning of connectivity at remaining NSCs.

    ii. CDNS Main Application System has been upgraded into state-of-the-art Business Application Solution and deployed at 35 National Savings Centers while remaining NSCs are in the process of migration to the centralized architecture by using the newly upgraded Business Application Solution. The aforesaid achievement has enabled CDNS for provisioning of advance, efficient and value-added services to its customers using Alternative Deliver Channels (ADCs) i.e. Debit/ATM Cards, etc.

    iii. Protocols have been laid down with National Database Registration Authority (NADRA) for obtaining Verisys and Biosys, which are necessary in the new digitized set up of the organization.

    iv. Vendor has been selected for providing the card (ATM/Debit Card) solution for CDNS.

    v. Agreement with 1Linkhas been signed for providing connectivity with banking sector/ATM operations.

    Achievement of Annual Targets:

    CDNS, being the foremost institution providing the avenue to general public to park their savings has been able to not only achieve the targets assigned but also surpassed by a big margin. As of 30.04.2019, the CDNS has achieved 213 % of the Gross and 191% of proportionate targets.

    Initiatives in the Pipeline:

    Sharia Product of National Savings

    There was a persistent demand of Sharia compliant product and CDNS has responded to it and has developed its first-ever Sharia Compliant product called Sarwa Islamic Savings Account (SISA) for those who desire to invest only in the Sharia-compliant scheme of CDNS. The Draft rules for it have been printed in the Gazette of Pakistan and after approval of the Cabinet Committee for Disposal of Legislative Cases (CCLC) and the Federal Cabinet, the proposed SISA Scheme will be introduced across the country.

    Overseas Pakistanis Savings Certificates (OPSCs)

    The Pakistani diaspora abroad wanted to have a secure investment channel for their savings while Government of Pakistan, in order to increase more also looked for bringing remittances into formal money channels which were mostly coming via informal channels. In this regard, to fill the void, OPSCs has been designed as a product by CDNS to be launched for Overseas Pakistanis only. It will be launched initially in the Gulf Cooperation Council (GCC) market and then other countries. The Agreement with Manger To the Issue (MTI) has been almost finalized. Being a scripless security, OPSCs will be offered in both the US$ and rupee currencies. It is expected that they will be launched in the Fiscal Year 2019-20.

    Launch of Rs. 100,000 Premium Prize Bond (Registered)

    After successful launch of Rs.40000, Premium Prize Bond (Registered) National Savings is in the process of launching another registered prize bond for Rs. 100,000

    Debit Card Launch & Membership of 1Link System

    In near future National Savings is launching ATM Debit Cards with the support of the Karandaaz Pakistan.

  • Economic Survey 2018/2019: SBP increases policy rate by 650bps in past 18 months

    Economic Survey 2018/2019: SBP increases policy rate by 650bps in past 18 months

    ISLAMABAD: State Bank of Pakistan (SBP) enhanced policy rate by 650 basis points during last 18 months (January 2018 to date) for macroeconomic stabilization.

    According to Economic Survey 2018/2019 issued by the ministry of finance on Monday said the SBP had adopted policy rate reversal and gradually increased it by a cumulative 650 bps since January, 2018.

    “Despite increase in policy rate, Weighted Average Lending Rate (WALR) remained stable which translated into healthy private sector credit demand.”

    Credit to private sector (CPS) increased to Rs 775.5 billion during FY2018 against Rs 747.9 billion last year. Significant increase in credit demand primarily came from working capital and fixed investment in the preceding year.

    During the period July-March, FY2019 CPS increased to Rs 554.7 billion compared with Rs 401.1 billion during same period of last year.

    Of which working capital loans received the major share and stood at Rs 369.0 billion compared to Rs 215.3 billion last year. While fixed investment decelerated to Rs 83.1 billion against Rs 148.1 billion in the comparable period last year.

    The survey said that the monetary policy is an important tool to achieve price stability and manage economic fluctuations.

    Inflation targeting has emerged as the leading framework for monetary policy over recent decades in many advanced and in low income economies.

    Monetary policy role after global financial crises has extended as macro prudential policy which required strong institutional framework for financial stability and to achieve twin objectives of price and output stabilization.

    Pakistan’s economy witnessed a consumption led growth of 5.53 percent during preceding year FY2018.

    The incumbent government has inherited the economy facing multiple challenges including unsustainable twin deficits that pose serious risks to the economy.

    Hence, to correct the imbalances in the economy, authorities have taken steps to curtail the fiscal deficits and tighten monetary policy to contain demand.

    SBP has significantly tightened monetary policy, and allowed greater flexibility in the exchange rate adjustments to curb excessive aggregate demand and move towards macroeconomic stabilization.

    This trend is in line with the global trends. The global economic expansion has weakened and projected to slow down from 3.6 percent in 2018 to 3.3 in 2019, before returning to 3.6 percent in 2020.

    Following a notable tightening of global financial conditions during second half of 2018, conditions have eased in early 2019 as the US Federal Reserve signaled a more accommodative monetary policy stance and markets became more optimistic about a US–China trade deal.

    The US federal funds rate is expected to increase to about 2.75 percent by the end of 2019. Policy rates are assumed to remain at close to zero in Japan through 2020 and negative in the Euro area until mid-2020.

  • Rupee depreciates Rs2.51 on higher import, corporate payments

    Rupee depreciates Rs2.51 on higher import, corporate payments

    KARACHI: The Pak Rupee ended down by Rs2.51 against dollar on Monday due to high demand for import and corporate payments as the currency market opened after a week.

    The rupee ended at Rs150.11 to the dollar from June 03, 2019 trading of Rs148.60 in interbank foreign exchange market.

    The interbank foreign exchange market was initiated in the range of Rs149.00 and Rs149.50.

    The market recorded day high of Rs151.25 and low of Rs149.50 and closed at Rs150.11.

    Currency experts said that the market was remained closed during June 04 to June 09 due to Eid and weekly holidays. The weeklong holidays jacked up the demand for import payments and corporate payments.

    The exchange rate also witnessed depreciation in rupee value in open market.

    The buying and selling of the dollar was recorded at Rs149.50/Rs150.50 as compared with June 03 closing of Rs147.80/Rs148.80.

  • Rupee falls by Rs1.60 against dollar in mid-day trading

    Rupee falls by Rs1.60 against dollar in mid-day trading

    The Pakistani rupee experienced a significant decline against the US dollar in mid-day trading on Monday, falling by Rs1.60 in the interbank foreign exchange market.

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  • SBP issues Rs360 billion worth fresh currency notes on Eid-ul-Fitr

    SBP issues Rs360 billion worth fresh currency notes on Eid-ul-Fitr

    KARACHI: The State Bank of Pakistan (SBP) has issued Rs360 billion worth fresh currency notes on the occasion of Eid-ul-Fitr, said a statement on Monday.

    The SBP said that through 16 field offices of its subsidiary SBP-Banking Services Corporation (SBP-BSC), provided fresh banknotes of various denominations aggregating to Rs360 billion, including Rs61 billion of Rs100 and below denominations, via cash counters of banks and SMS service (8877) to general public during Ramazan.

    Out of Rs61 billion, Rs54 billion were issued through the SMS service which was available in 142 cities through more than 1,700 commercial bank branches and 16 field offices of SBP BSC.

    The service catered to more than 3 million people before Eid-ul-Fitr.

    State Bank has also issued a sufficient quantity of fresh notes of higher denominations to banks for smooth ATM operations during the Eid Holidays.

    In this regard, special teams of SBP and SBP BSC officials shall inspect and monitor the working of ATMs across Pakistan to ensure uninterrupted availability of cash to the general public during the Eid holidays.


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  • SBP issues instructions for bank account biometric verification of Pakistanis living abroad

    SBP issues instructions for bank account biometric verification of Pakistanis living abroad

    KARACHI: The State Bank of Pakistan (SBP) on Monday issued instructions for biometric verifications of bank account holders of Pakistanis living abroad.

    The banks are conducting biometric verification of existing customers in compliance of Anti Money Laundering/ Counter Finance Terrorism (CFT) Regimes.

    a. Non-resident Pakistanis (NRPs) as defined in Income Tax Ordinance, 2001 – Chapter 5, Division II, Section 82:

    For customers who fall under the definition of NRP, the bank/ DFI may obtain a signed undertaking from the customer invariably containing the following:

    • Customer’s NRP status along with proof (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.)

    • Copy of valid ID document (CNIC/ NICOP)

    • Account number(s) of the customer’s account(s) maintained with the bank as per customer record

    • Undertaking by the customer to inform the bank of any change in residency status

    The bank/ DFI, after verification of the customer’s signature from its record, shall accordingly update/ reflect the NRP status in the customer profile.

    For such customers, as an alternative to biometric verification, the bank/ DFI may conduct fresh NADRA Verisys using the information provided by the customer.

    b) Resident Pakistanis temporarily outside Pakistan:

    For customers who do not qualify under the definition of NRP, but are currently/ temporarily outside Pakistan for any reason, the bank/ DFI may obtain reasonable evidence/ proof from the customer regarding his/ her absence from the country (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.) and the expected date of return.

    For such customers, as an alternate to biometric verification, the bank/ DFI may conduct fresh NADRA Verisys using the information provided by the customer.

    The bank/ DFI may retain the NADRA Verisys in place of biometric verification until the customer returns, subject to reasonable time limit (not more than six months) to be defined by banks/ DFIs. Biometric verification of such customers shall be done immediately upon the customer’s return to the country.

    c) Joint Accounts- where one account holder is outside Pakistan (NRP/ temporarily):

    For joint account holders, treatment of biometric verification should be done according to the status of respective individual. Biometric verification should be conducted for the joint account holder who is resident Pakistani, while for other joint account holders, the relevant procedure described at (a) and (b) above should be adopted.

    The SBP said that it is again advised that as per the Frequently Asked Questions (FAQs) on Use of Biometric Technology issued by SBP vide BPRD Circular Letter No. 20 dated June 14, 2017, banks/ DFIs may operate accounts on the basis of NADRA Verisys in genuine cases (as provided in FAQ No. 8), provided the bank/ DFI is satisfied and proper reason/ proof is recorded/ retained by the bank/ DFI.

    For such cases in line with Para-3 above, in the absence of biometric verification, bank/ DFI may ensure that requisite identification document has been obtained, marked as ‘original seen’ by their staff and verified through NADRA Verisys. Moreover an undertaking should be obtained from the customer declaring that the particulars provided to the bank/ DFI are correct and that their staff has verified the same. The declaration should be endorsed by the Branch Manager and should be available in the bank’s centralized record.

  • Rupee weakens by 70 paisas ahead of weeklong Eid Holidays

    Rupee weakens by 70 paisas ahead of weeklong Eid Holidays

    KARACHI: The Pak Rupee weakened by 70 paisas against dollar on Monday owing to higher demand for import and corporate payments due to upcoming Eid holidays.

    The rupee ended Rs148.60 to the dollar from last Friday’s closing of Rs147.90 in interbank foreign exchange market.

    The interbank foreign exchange market was initiated in the range of Rs148.00 and Rs148.50.

    The market recorded a high of Rs148.90 and low of Rs148.00 and closed at Rs148.60.

    Currency experts said that the demand was increased due to upcoming weeklong holidays.

    The exchange rate in open market also witnessed decline in rupee value.

    The buying and selling of dollar was recorded at Rs148.00/Rs149.00 as compared with previous closing of Rs147.50/Rs148.50 in cash ready market.

  • Rs52 million approved as interest free loan for students

    Rs52 million approved as interest free loan for students

    KARACHI: The apex committee for Student Loan Scheme having representation from State Bank of Pakistan, Finance Division (Government of Pakistan) and five major banks (NBP, HBL, UBL, ABL and MCB Bank) has approved Rs 51.987 million as interest-free loans to deserving students for their current year of studies within Pakistan.

    State Bank of Pakistan (SBP) in a statement on Monday said that the amount, approved by Apex Committee, will be given to 966 deserving students of public sector universities across the country, studying in different disciplines of under-graduation, graduation and Ph.D studies for the session 2016-2017.

    The objective of the Student Loan Scheme is to provide financial assistance to the meritorious students having insufficient means.

    The loans are granted for a maximum tenor of 10 years from the date of the disbursement of first installment and repayable in monthly installments after six months from the date of first employment or one year from the date of completion of studies, whichever is earlier.

    National Bank of Pakistan, being the administrator of the Scheme, performs all the functions like receiving and scrutinizing the loan applications, disbursement of loans and their recovery.

    The names of successful students are available at the National Bank of Pakistan’s website: https://www.nbp.com.pk/studentloan/

  • Sindh Bank refuses Summit Bank merger plan

    Sindh Bank refuses Summit Bank merger plan

    The board of directors of Sindh Bank Limited (SNBL) has officially rejected the proposed merger with Summit Bank Limited (SMBL), marking a significant development in the banking sector.

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  • Update: Rupee weakens 48 paisas in intraday trading

    Update: Rupee weakens 48 paisas in intraday trading

    KARACHI – The Pakistani Rupee faced a further depreciation of 48 paisas against the US Dollar in intraday trading on Monday, creating fluctuations in the currency market just ahead of the Eid Holidays.

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