Visit no longer needed for opening bank account

The State Bank of Pakistan (SBP) has said that Pakistanis are no longer required to visit a branch for opening an account and instead can use the digital framework designed by the central bank for the purpose.

"Based on the success of the Roshan Digital Account framework, the SBP has now devised a comprehensive 'Customers' Digital Onboarding Framework', which will facilitate banks and Microfinance Banks (MFBs) to conveniently and remotely open bank accounts of resident Pakistanis by using digital channels including websites/portal, mobile applications, digital kiosks etc.," said the SBP.

The SBP said that with the rapid growth in adoption of electronic banking channels, especially amid the Covid-19 pandemic, the demand from bank and customers for digital financial transactions have increased manifold.

SBP launches four Asaan account categories to boost financial inclusion

The SBP has advised the banking industry to implement this framework by Dec 31, 2021. The central bank is confident that this initiative will help promote digitisation of banking services in the country apart from achieving the financial inclusion objectives. The framework would also provide a tool to the industry and an impetus to SBP's initiative of Banking on Equality by bringing women into the financial system, it added.

"The framework in general provides a convenient way for all segments of society for opening bank accounts, it specifically enables freelancers, self-employed or unemployed women, and recipient of remittances from abroad to open bank account digitally with minimum documentation requirements," it added.

The framework has been finalised after carrying out an extensive consultation with stakeholders, to obtain opinion from industry experts and to proactively address the challenges, which banks and MFBs might face during the implementation of this framework.

While typically accounts can be opened as either Savings or Current Account, the framework identifies four categories on the basis of functional limits such as deposit or withdrawal limits, fund transfer limits etc and the documents required for opening an account.

These categories include 'Asaan Digital Account'; 'Asaan Digital Remittance Account'; 'Freelancer Digital Account'; and the 'Digital Account.' The first category is the easiest to open requiring very basic information and the least number of documents albeit with some limits on functionality. The last category, i.e. Digital Account is without any functional restriction but needs more information for account opening. A customer can start with the basic account and can upgrade over time to higher level of account type when needed.

The State Bank of Pakistan (SBP) pumped $1.2 billion into the inter-bank market in three months to defend the weakening rupee but could not stop the local currency from falling to a historic low, highlighting the cost of expansionary policies without fixing the structural economic flaws.

The $1.2 billion injection into the foreign exchange market is contrary to the stated policies of the central bank, International Monetary Fund (IMF) and finance ministry, as all the three institutions claim that the rupee value is determined by market forces.

From mid-June to the first week of September, the central bank injected $1.2 billion out of its reserves, government sources told The Express Tribune. The maximum single-day injection of $100 million was made in July, followed by $85 million in August, they added.

The central bank reserves are built by taking expensive foreign loans like floating the Eurobond and issuing the expensive Naya Pakistan Certificates. The $1.2 billion injection was slightly higher than the $1 billion Eurobond loan that Pakistan took at 5.9% to 8.5% interest rate in July this year.

With the fresh injection, at least $5.8 billion has been thrown in the inter-bank market during the tenure of Pakistan Tehreek-e-Insaf (PTI) government to maintain an artificial value of the rupee.

Neither the Ministry of Finance nor the central bank explicitly denied that the SBP threw dollars in the market to defend the rupee.