Karachi, December 10, 2024 – The State Bank of Pakistan (SBP) has issued new directives mandating banks to provide free transaction alerts to customers using digital banking services. The initiative aims to enhance the security and transparency of financial transactions conducted through mobile and internet banking platforms.
According to the circular released by the SBP, these instructions build upon earlier measures outlined on April 14, 2023, to strengthen digital payment security. Banks and Microfinance Banks (MFBs) that have implemented these measures can now replace traditional One-Time Passwords (OTP) sent via SMS with a Transaction PIN (TPIN) or Financial PIN (FPIN) for mobile and internet banking transactions.
The SBP has emphasized that banks must send transaction alerts free of charge through push notifications, in-app messages, or email. To ensure seamless communication, banks must keep in-app notifications enabled by default for all customers. Moreover, they are required to maintain comprehensive logs of all transaction notifications, making these records accessible in case of disputes or fraud claims.
Additionally, banks must adhere to notification templates provided by the SBP in Annexure A of the circular. These templates supersede prior instructions outlined in PSD Circular No. 3 issued on May 9, 2018.
The SBP also reiterated its commitment to protecting customers from fraudulent activities. If unauthorized transactions occur through mobile banking apps, banks or MFBs will be held accountable and must compensate affected customers following the liability framework established in BPRD Circular No. 04 of 2023.
The SBP’s updated guidelines come into effect from January 1, 2025. The move is part of the SBP’s broader effort to modernize Pakistan’s banking sector, improve customer trust, and ensure robust digital payment security.
By mandating free transaction alerts and enhancing notification systems, the SBP is taking a significant step toward safeguarding digital banking users. This initiative reflects the SBP’s proactive approach to addressing the evolving challenges of cybersecurity and fraud in the financial sector, ultimately fostering greater confidence in Pakistan’s digital banking landscape.
