SBP instructions to banks on pension payment via DCS

KARACHI: The State Bank of Pakistan (SBP) on Monday directed commercial banks to follow the standard operating procedures (SOPs) for pension payment through direct credit system (DCS), a circular said.

The SBP said the government on January 6, 2021 made some amendments into the SOPs for the direct credit system to bring transparency and ease in the pension payment process. “Pensioner shall be required to undergo biometric verification from any branch of a bank maintaining his/her pension account, every year in March and September,” said the SBP’s circular. “If the pensioner is unable to undergo biometric verification due to incapacitation by bodily illness, infirmity, or if his/her fingerprints do not exist due to old age or a genetic condition, he/she will provide a life certificate as per the SOPs.”

In case of family pension, the central bank said non-marriage declaration would be obtained from pensioners on or before September 30 of each year instead of March and September.

Submission of above mentioned non-marriage declaration would be dispensed with after the widow/ daughter/sister of the pensioner (family pension recipient) attains the age of sixty years, it mentioned. If a pensioner fails to submit a life certificate or fails to undergo biometric verification during March and September or a pensioner does not draw a pension for consecutive six months, the account would become dormant, according to the circular. “The requirement of submission of indemnity bond by a pensioner is discontinued,” it revealed. The pension would be paid through a bank account either current or PLS maintained in the pensioner’s name. A pension account would not be a joint account. A bank account dedicated to pension transactions only would not be mandatory for the pension.