Tag: State Bank of Pakistan

Banks to reveal key information for deposit accounts

KARACHI: State Bank of Pakistan (SBP) on Monday issued guidelines for banks to ensure disclosure of key information for deposit accounts.

In a circular, the central bank said that effective disclosure is considered a fundamental component of the Financial Consumer Protection regime.

Standardized disclosures as Key Fact Statements (KFS) increase consumer comprehension about a banking product’s affordability and risks, leading to better decision-making.

Similarly, KFS also minimizes the risks of ineffective disclosures on part of the banks by standardizing the information provided to the consumer.

The SBP in its endeavor to promote Responsible Banking Conduct and Fair Treatment of Consumers (FTC) recognizes the importance of standardized disclosures.

Accordingly, KFS for consumer credit products and Most Important Document (MID) for third party products have already been issued vide CPD Circular No.3 of 2014, BC & CPD Circular No. 2 of 2016, and CPD Circular No. 2 of 2012.

KFS for deposit products have now been developed and are being issued through this circular for adoption as per the requirements listed below:

Banks/MFBs/DFIs are required to provide KFS to all their prospective customers from April 1, 2021, for comparison and decision making. Banks/MFBs/DFIs will ensure the availability of KFS in branches, on the website, e-banking interfaces, etc.

At the time of account opening, the KFS duly signed by the Banks/MFBs/DFIs, and the customer will be retained with the account opening form and its duplicate copy will be provided to the customer for record and information.

Banks/MFBs/DFIs are required to make necessary changes in their related SOPs and Policies for the seamless adoption of KFS to incorporate the requirement of KFS. Further, the provision of KFS as mentioned above in para 1 and the accuracy of the information contained therein will be checked by the Internal Audit during the regular audit.

Adequate consumer awareness initiatives and staff training may also be undertaken by Banks/MFBs/DFIs regarding the use of KFS and its vitality.

December 14, 2020
Remittances grow 27 percent during July – November

KARACHI – The State Bank of Pakistan (SBP) reported a significant 27% growth in workers’ remittances during the first five months (July-November) of the current fiscal year (FY21), underscoring a resilient trend in foreign inflows facilitated through formal channels.
(more…)

December 11, 2020
Banks allowed opening foreign currency accounts of entities operating in STZs

KARACHI: State Bank of Pakistan (SBP) on Friday allowed commercial banks to open foreign currency accounts by entities operating under newly established Special Technology Zones (STZs)

The SBP in a notification said that in order to further the objectives of establishing the Special Technology Zones under the Special Technology Zones Authority Ordinance, 2020, it has been decided to issue special foreign exchange regulations for entities operating in Special Technology Zones in Pakistan, in terms of sub-section 5 of Section 19 of the Ordinance and in exercise of powers conferred under the Foreign Exchange Regulation Act, 1947.

Accordingly, the following new paragraph 9A has been inserted after paragraph 9 of Chapter 6 of Foreign Exchange Manual:

9A – Special Foreign Exchange Regulations for Special Technology Zones (STZs)

Authorized Dealers may open Special Foreign Currency Accounts of entities licensed by Special Technology Zones Authority (STZA) under the Special Technology Zones Authority Ordinance, 2020.

Such foreign currency accounts can be fed with any proceeds, in favor of the entity, originating from abroad including foreign borrowing, proceeds from exports of goods and services, foreign equity, earnings / profits of overseas offices / subsidiaries / associates established through funds from these accounts, without the requirement of conversion into PKR. However, these accounts cannot be fed with cash foreign currency or any foreign exchange purchased from an Authorized Dealer or an Exchange Company in Pakistan for any purpose.

The funds available in such foreign currency accounts may be used by the account holders for making all types of business related legitimate payments abroad without any limitation and without any approval from SBP, subject to completion of applicable documentary/reporting requirements under relevant foreign exchange regulations.

In case sufficient funds are not available in Special Foreign Currency Accounts of such entities, with any Authorized Dealer in Pakistan, for making any legitimate payment abroad in foreign exchange, these entities may be allowed to make entire payment of the underlying transaction by purchasing foreign exchange from interbank market, subject to compliance with applicable foreign exchange regulations. However, Authorized Dealers shall obtain an undertaking from such entities to the above effect.

In case any local payment is required to be made from Special Foreign Currency Accounts by such entities, the same shall be allowed by Authorized Dealers after converting the funds, available in such accounts, into PKR through inter-bank market. However, no cash withdrawal will be allowed in the shape of FCY notes.

December 11, 2020
Foreign exchange reserves increase by $160 million

KARACHI: The liquid foreign exchange reserves of the country have increased by $160 million to $20.402 billion by week ended December 04, 2020, State Bank of Pakistan (SBP) said on Thursday.

The foreign exchange reserves of the country were at $20.242 billion by week ended November 27, 2020.

During the week ended December 04, 2020, SBP received $359 million from multilateral/bilateral sources including $307 million from Asian Development Bank (ADB).

After accounting for external debt repayments, SBP reserves increased by $188 million to $13.298 billion.

The foreign exchange reserves held by commercial banks however fell by $27 million to $7.104 billion by week ended December 04, 2020 as compared with $7.131 billion a week ago.

SBP approves Rs82.6 million interest free student loan

December 10, 2020
Sale of Rs25,000 denomination prize bonds stopped

KARACHI: The government has stopped the sale of prize bonds of Rs25,000 denomination with immediate effect and the same shall not be encashed / redeemed after May 31, 2021, State Bank of Pakistan (SBP) said on Thursday.

The SBP said that the finance ministry had already issued instructions in this regard a day earlier. The ministry also announced the issuance of registered or premium prize bonds of Rs25,000 denomination.

The SBP issued following instructions to the president and CEOs of all commercial banks regarding option to replace / encash the bonds:

1. Conversion to Premium Prize Bonds (Registered)

i. The Bonds can be converted to Rs. 25,000/-denomination Premium Prize Bonds (Registered) through the 16 field offices of SBP Banking Services Corporation, and branches of six authorized commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited and Bank Alfalah Limited.

ii. The authorized commercial banks shall also issue Rs. 25,000/-denomination Premium Prize Bonds (Registered)as per the prescribed procedure, with immediate effect. Stock of the same has already been delivered to authorized commercial banks.

iii. The bondholder shall be required to submit a written request for conversion of bearer bonds to Rs. 25,000/-Premium Prize Bonds (Registered) on the prescribed application form.

iv. The bondholder shall also be required to submit prescribed application forms for registration / purchase of Premium Prize Bonds as per the procedure in vogue.

2. Replacement with Special Savings Certificate (SSC) / Defence Savings Certificate (DSC)

i. The Bonds can be replaced with SSC / DSC through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks and National Savings Centers.

ii. All authorized commercial banks shall, therefore, accept requests for replacement of bearer bonds with SSC or DSC on the prescribed application form.

iii. The bondholder shall also be required to submit application form for purchase of SSC / DSC (SC-1) as per the prescribed procedure

3. Encashment at Face Value

i. The Bonds will only be encashed by transferring the proceeds to the bond holder`s bank account through the 16 field offices of SBP Banking Services Corporation, at authorized commercial bank branches and to the Savings Accounts at National Savings Centres.

ii. All commercial banks shall receive requests for encashment of bearer bonds on the prescribed application form.

A copy of the application form (Annexure A), duly signed and stamped, shall be provided to the bondholder as an acknowledgement receipt.

Moreover, the prize bonds encashed / replaced by the general public may be surrendered to the concerned SBP BSC office through the respective regional office of the commercial bank.

For this purpose, the regional office may intimate the SBP BSC office three days in advance so that necessary arrangements for receipt of the bonds can be made.

It is imperative to mention that a notice regarding the above-mentioned facilities must be displayed at prominent places within branch premises for awareness and information of the general public.

December 10, 2020
Date extended for Rs40,000 prize bonds withdrawal

KARACHI: State Bank of Pakistan (SBP) on Tuesday announced extension in date for encashment, replacement and conversion of unregistered Rs40,000 denomination prize bonds.

The SBP said that the date for withdrawal of the prize bonds had been extended up to December 30, 2021.

The central bank said that the Finance Division, Government of Pakistan has extended the last date for encashment / replacement / conversion of Rs. 40,000/- denomination National Prize Bonds (bearer) till December 30, 2021 vide their Notification No. F.16(3)GS-I/2014-1603 dated November 26, 2020.

The branch / region wise consolidated data of Rs. 40,000/- denomination prize bonds held by them on last date i.e. December 30, 2021 shall be shared latest by December 31, 2021, as per the instructions stipulated in Para 4 of CMD Circular No. 4 dated June 30, 2020.

All other instructions in this regard shall remain unchanged.

Kindly disseminate aforementioned instructions to all branches and concerned officials for information and strict compliance, the SBP said.

December 8, 2020
Banks observe extended working hours to facilitate taxpayers

KARACHI: The State Bank of Pakistan (SBP) has instructed banks across the country to observe extended hours on December 8, 2020, in a move aimed at facilitating taxpayers in making timely payments of duties and taxes.
(more…)

December 7, 2020

Key data of banking system: bank accounts top 60 million

KARACHI: Around 60 million bank accounts are in the country having population of 208.31 million, the State Bank of Pakistan (SBP) said in a report.

The SBP in its report on payment system released this week said that the currency circulation by September 30, 2020 was at Rs6,422 billion.

According to the central bank the payment system infrastructure as on September 30, 2020:

Number of Banks (Branches)	44(16,121)
Commercial/ Specialized Banks Branches	14,938
Microfinance (Branches)	1,183
Number of Real Time Online Branches (RTOBs)	15,978
Number of banks having ATM machines	35
Number of banks having open-looped POS machines	5
Number of banks having closed-looped POS machines	4
Number of banks providing Internet Banking services	27
Number of Banks providing Mobile Phone Banking services	27
Number of Banks providing Call Center Banking services	23
Total Number of PRISM System Participants	50
Total number of ATMs Interoperable Switches	1
Total number of Cash & Cheque Deposits Machines (CDMs)	184
Total number of Cash Deposits Machines with Cash Withdrawal facility	20
Multipurpose ATMs (With Cash & Cheque Deposit & Cash Withdrawal)	15

December 6, 2020

President praises SBP, banks for progress in financial inclusion of disable persons

KARACHI: The President of Pakistan, Dr. Arif Alvi has appreciated efforts of State Bank of Pakistan (SBP) and performance of banks in improving the accessibility infrastructure at banks for persons with disabilities and lauded their efforts for increasing financial inclusion of persons with disabilities.

The president shared his view in an online meeting with the SBP governor Dr. Reza Baqir, SAPM on Poverty Alleviation and Social Safety, Dr Sania Nishtar, senior SBP officials and Presidents/CEOs of banks on Friday, according to a statement issued by the SBP. The meeting took stock of the progress on decisions made for improving the accessibility infrastructure for persons with disabilities.

The president also appreciated the establishment of a Working Group by SBP for taking up the agenda.

Dr. Alvi said that the unavailability of concrete information on the number of people with disabilities is a major limitation for designing comprehensive plans to improve their quality of life.

He shared that the government is working with different stakeholders to have a better estimate of the number of people with disabilities that will help their identification and certification.

He, however, desired that timelines along with a clear vision must be defined clearly for the Working Group.

He further emphasized that such working groups may also be created at each bank. He stated that creating awareness regarding various facilities for persons with disabilities is highly imperative and social media can play an important role in this regard.

The president further said that plight of persons with disabilities has become even more critical in the middle of the prevalent COVID 19 crisis that is deepening pre-existing inequalities.

He appreciated SBP’s specific role in taking a number of measures to address the likely negative economic impacts on individuals, businesses and banking institutions.

The State Bank’s successful measures have reduced the negative impacts of COVID-19 on economic growth, employment generation and at the same time ensured that the banking and payment systems remain healthy, he said.

In response to President, Dr. Alvi’s call, Governor SBP, Dr. Baqir, assured that SBP would continue providing its full regulatory support to increase financial inclusion of persons with disabilities.

The banks’ Presidents/CEOs also pledged their complete cooperation for this objective.

In his welcome remarks, the SBP governor appreciated the exceptional interest and resolve of the President of Pakistan as a source of inspiration for all the stakeholders.

He said that if the society does not provide appropriate support to persons with disabilities, it leads to their economic disempowerment depriving them of their independent economic and social lives.

He remarked that persons with disabilities could economically support themselves and contribute towards the society at large when provided with adequate education, rehabilitation and financial and moral support.

He emphasized that a sizeable number of persons with disabilities do have the required capacity to work and contribute in the mainstream economic activities and thus successfully support their families.

He urged the banks to be cognizant of this gap and explore avenues to make inclusion of this untapped segment of the economy a reality.

SBP presented an update on different action items decided in the last meeting of SBP with the President.

The action items included accessible infrastructure at entrance of all bank branches and ATM cabins, availability of forms and documents in braille for basic banking services, accessibility audit of bank branches by SBP and allocation of credit targets for SBP refinance schemes on SME and Low Cost Housing Finance.

December 4, 2020
E-commerce transactions through debit cards up by 152 percent

KARACHI: The online payment through debit cards for e-commerce registered phenomenal growth of 152 percent in first quarter of current fiscal year, according to data released by State Bank of Pakistan (SBP) on Thursday.

The online payment for e-commerce increased to Rs11.1 billion in the first quarter (July – September) 2020/2021 as compared with Rs4.4 billion in the same quarter of the last fiscal year.

The volume of transactions also registered around 200 percent during the period under review. According to SBP data the volume of debt card transactions increased to 3.9 million during first quarter of the current fiscal year as compared with 1.3 million in the same quarter of the last fiscal year.

The total e-commerce transactions registered 81 percent growth during the first quarter of the current fiscal year. The value of e-commerce transactions (payment through debt, credit and pre-paid cards) increased to Rs24.1 billion during the quarter under review as compared with Rs13.5 billion in the same quarter of the last fiscal year.

The e-commerce transactions through credit card increased to Rs12.9 billion during the first quarter of fiscal year 2020/2021 as compared with Rs9.1 billion in the corresponding quarter of the last fiscal year.

December 3, 2020