SBP determined to achieve goal of ‘Banking for All’

Outlines policy measures to enhance financial inclusion


Our Correspondent October 10, 2012

KARACHI:


State Bank of Pakistan (SBP) Deputy Governor Kazi Abdul Muktadir has expressed a resolve to provide banking services to all segments of the society.


Addressing journalists during a visit to the Karachi Press Club on Tuesday, he said that with concerted effort, “we will be able to achieve the desired goal of ‘Banking for All’.”

Emphasising the need for an efficient and thriving banking system, he said that SBP is providing a regulatory environment to financial institutions to enhance financial inclusion in the country. “Providing people with access to finance is a challenging task, not just for the central bank, but also for all stakeholders,” he observed.

“The State Bank of Pakistan is trying to make banking services available at the doorsteps of the people,” he said. The SBP, under its branch licensing policy, has made it compulsory for banks to open at least 20% of all new branches in rural and under-served areas.

He pointed out that branchless banking is helping in reaching out to the low-income, unbanked category through more than 30,000 access points throughout the country. Nearly 30 million transactions worth Rs115 billion had been processed during the fourth quarter of last fiscal year through branchless banking and average daily transactions have been reported at 315,178, while total number of branchless banking accounts has increased to 1.7 million.

According to the World Bank’s Consultative Group to Assist the Poor, Pakistan is the fastest growing branchless banking market in the world.

Muktadir said the banking industry of Pakistan has tremendous growth potential and can deliver a lot more than what it is delivering right now. “The significance of e-banking and m-commerce cannot be overemphasised, because both have brought about remarkable changes in the ways people think and do their banking business today,” he added.

He said the transformation from traditional to modern ways of banking is taking place at a fast pace. A number of alternate delivery channels for provision of banking services like ATMs, credit cards, point-of-sales terminals, internet banking and debit cards already exist in the country to benefit the masses. “Currently, 93% of all bank branches are offering Real-Time Online services,” he added.

Muktadir said the SBP would ensure that high level of banking service standards are maintained for safety, security and cost-effectiveness, with adequate levels of protection for consumer interests.

The SBP deputy governor pointed out that the availability of ATMs is quite low, as there are only 5,600 ATMs in the country. At present, there is an average of one ATM for every two bank branches, while in developed countries there are three ATMs for every bank branch.

The SBP has recently issued policy instructions to all banks which bind them to expand their ATM network in a phased manner, so as to achieve the target of one ATM for each bank branch. “Once this target is achieved, we have plans to gradually raise the bar so as to meet international levels,” he added.

Published in The Express Tribune, October 10th, 2012.

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