KARACHI: The State Bank of Pakistan (SBP) on Friday extended concessions given to commercial and microfinance banks on account of the pandemic till June 30, 2022 for ease in banking and transaction activities.
In the wake of the ongoing impact of the pandemic, the SBP decided to extend the validity of the regulatory relaxations it gave to financial institutions due to Covid-19 last year. The relaxations were for easing the challenges faced by banks and their account holders.
On December 31, 2021, these concessions had to be withdrawn; however, the central bank decided to give an extension of six months, as per a notice.
It has allowed banks to continue to utilise NADRA Verisys in place of biometric verification, where the same was not possible or appropriate due to risk of Covid-19 spread, the SBP said in a statement.
Banks and microfinance banks would continue with enhanced transaction limit of Rs500,000 per month and maximum account balance of Rs500,000 for non-biometrically verified merchant accounts, it added. Authorised Financial Institutions (AFIs) would not downgrade non-biometrically verified Branchless Banking (BB) legacy Level-1 accounts to Level-0, according to the SBP’s circular.
“However, unless instructed otherwise, the above mentioned relaxations will automatically stand withdrawn upon expiry of the extended timeline of June 30, 2022,” the central bank statement said.
After the given date, banks and microfinance banks would have to follow the applicable regulatory instructions in the related areas.
The financial institutions have been advised by the central bank to take appropriate measures and steps to ensure smooth transition to normal operations without Covid-19 related regulatory forbearance.
Moreover, AFIs should continue to provide person-to-person (P2P) transfers through the BB channel, till June 30, 2022, the statement added.
AFIs were advised to take necessary measures, such as creating customer awareness, making adjustments in their business model and infrastructure accordingly, it said.
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