SBP stops banks from discriminating in consumer finance
Receives complaints against discriminatory practices on part of banks
PHOTO: EXPRESS
KARACHI:
The State Bank of Pakistan (SBP) has stopped commercial banks and development finance institutions (DFIs) from discriminating against any segment of the society.
“In continuation of earlier instructions, the SBP has advised banks/DFIs to not discriminate against any segment of the society and follow the SBP instructions issued earlier,” the central bank said in a statement issued on Monday.
The instructions require banks/DFIs to desist from adopting discriminatory practices on the basis of trade, region, gender, ethnicity, specific profession, class and/or group of citizens eg lawyers, politicians, security officials, law enforcement agencies, etc.
Politically exposed persons had time and again raised their concern about discriminatory practices on the part of banks in providing consumer finance and general banking facilities, it added.
The SBP asked banks/DFIs to explicitly convey reasons for refusal in writing to the applicant and keep a separate file of all approved and rejected cases of politically exposed persons.
It said such practices were against the spirit of fundamental rights contained in the Constitution of Pakistan and regulatory instructions on the subject and that these complaints had been viewed seriously at the central bank.
The SBP cautioned that any violation of the instructions would attract punitive action under relevant provisions of the Banking Companies Ordinance 1962.
Published in The Express Tribune, May 9th, 2017.
The State Bank of Pakistan (SBP) has stopped commercial banks and development finance institutions (DFIs) from discriminating against any segment of the society.
“In continuation of earlier instructions, the SBP has advised banks/DFIs to not discriminate against any segment of the society and follow the SBP instructions issued earlier,” the central bank said in a statement issued on Monday.
The instructions require banks/DFIs to desist from adopting discriminatory practices on the basis of trade, region, gender, ethnicity, specific profession, class and/or group of citizens eg lawyers, politicians, security officials, law enforcement agencies, etc.
Politically exposed persons had time and again raised their concern about discriminatory practices on the part of banks in providing consumer finance and general banking facilities, it added.
The SBP asked banks/DFIs to explicitly convey reasons for refusal in writing to the applicant and keep a separate file of all approved and rejected cases of politically exposed persons.
It said such practices were against the spirit of fundamental rights contained in the Constitution of Pakistan and regulatory instructions on the subject and that these complaints had been viewed seriously at the central bank.
The SBP cautioned that any violation of the instructions would attract punitive action under relevant provisions of the Banking Companies Ordinance 1962.
Published in The Express Tribune, May 9th, 2017.