In a first, Pakistani central bank says will issue digital banking licenses this year

A brass plaque of the State Bank of Pakistan is seen outside of its wall in Karachi, Pakistan, on December 5, 2018. (REUTERS/File)
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Updated 04 January 2022
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In a first, Pakistani central bank says will issue digital banking licenses this year

  • Latest in series of initiatives by Pakistan to introduce new payment solutions to tap massive unbanked population
  • Digital bank give people access to banking wherever they are and wherever they have secure Wi-Fi and strong cell signal

KARACHI: The State Bank of Pakistan (SBP) has introduced a regulatory framework to issue licenses for digital banks in line with global practices, the central bank said this week, hoping the move will usher in a new era for the country's banking industry. 

A digital bank offers all kinds of financial products and services primarily through digital platforms or electronic channels, essentially giving people access to banking wherever they may be and wherever they have secure Wi-Fi and strong cell signal.

Introducing a regulatory framework for digital banks is the latest in a series of recent initiatives by the State Bank of Pakistan towards introducing new payment solutions in a country with a massive unbanked population.

"This is the first step towards introducing a completely digital bank that will provide all the banking services, from account opening to deposit and lending, through digital means and the customers will not need to visit any bank branch physically," the central bank said in a statement on Monday. "Digital banks are the culmination of the digital journey on which the banking industry embarked upon many years ago."

The newly issued licensing and regulatory framework provides details for setting up digital banks as a separate and distinct category in Pakistan.     

Under the framework, the SBP will grant two types of digital bank licenses:  Digital Retail Bank (DRB) and Digital Full Bank (DFB). DRBs will primarily focus on retail customers, while DFBs will deal with retail customers as well as businesses and corporate entities. 

"The framework mainly aims to enhance financial inclusion through affordable/cost effective digital financial services," the SBP said. "The framework includes guidance regarding licensing requirements, potential sponsors and permissible use-cases during different phases." 

The framework also sets an expectation for applicants to have sound digital governance, robust, secure and resilient technology infrastructure as well as effective data management strategy and practices.  

As per the framework, digital banks are required to maintain a principal place of business in Pakistan to house offices of its management, staff and support operations, which will serve as the main hub of contact for various stakeholders, including the SBP and other regulators. 

The state bank said licenses for DRBs and DFBs may be obtained for both conventional and Islamic variants, while conventional variants of DRBs and DFBs could also offer Islamic banking services through Islamic windows.

The central bank said setting up digital banks would also require less capital, compared to the brick-and-mortar banks currently in existence, and encourage new technology-oriented entrepreneurs to enter this new realm of business.  

The minimum capital requirement for DRBs during the pilot phase is Rs1.5 billion, which will gradually increase to Rs4 billion over a transition period of three years, according to the SBP.

Subsequent to the completion of the transition phase, DRBs may graduate to receive a DFB license, subject to the fulfillment of the minimum capital requirement and the completion of a two-year progression phase.  

Earlier, the SBP released an exposure draft of the regulatory framework and a targeted survey was launched to invite feedback from a wide range of local as well as international stakeholders. The framework covers all the essential guidance and supplementary regulations for a diverse range of possible applicants interested in setting up digital banks in Pakistan.    

"In line with international best practices and assessment of the overall banking situation in Pakistan, SBP has decided to initially issue up to five digital banks’ licenses, which essentially means that SBP is looking to attract players with strong value proposition, a robust technological infrastructure, sufficient financial strength, technical expertise and effective risk management culture," the central bank said.  

SBP will be accepting applications in for digital banking licenses till March 31, 2022.  Applicants may submit their requests along with all requisite documents at [email protected], according to the SBP statement. They may also approach the central bank for any clarification at [email protected]

Other recent SBP digitalization initiatives, which are gaining traction in Pakistan, include customer digital on-boarding, Roshan Digital Accounts, the Raast instant payment system, Electronic Money Institutions licenses and Asaan Mobile Accounts. 


Volunteers who helped with rescue work during UAE rains honored by Pakistani consulate

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Volunteers who helped with rescue work during UAE rains honored by Pakistani consulate

  • Last month UAE received heaviest rains in the 75 years that records have been kept
  • Rains brought much of the country to a standstill and caused significant damage

ISLAMABAD: A team of Pakistani volunteers who helped rescue hundreds of people and dozens of vehicles during last month’s record-breaking rains and flooding in the UAE have been honored by the Consulate General of Pakistan in Dubai, a press statement from the mission said on Thursday.

Last month, Dubai was hit by unprecedented storms that paralyzed the Emirates for days. The downpours brought much of the country to a standstill and caused significant damage, flooding trapped residents in traffic, offices and homes and overrunning malls and roads.

“The volunteers were honored with certificates of appreciation by the Consul General in recognition of their unmatched services. Other officers and officials of the consulate were also present on the occasion,” the consulate’s statement said. 

“We are immensely proud of the Pakistani volunteers who demonstrated exceptional courage and compassion during the recent heavy rains in the UAE. Their selfless dedication to rescuing those in need reflects the true spirit of humanity … We salute these volunteers for their unwavering commitment to serving others, and their actions serve as an inspiration to us all.”

One volunteer, Tanvir Athar, said their efforts had also inspired others. 

“After our services in the recent rains, a number of volunteers have connected us and offered their services for any such efforts in future,” Athar was quoted in the statement as saying. 

He said the group of volunteers had been rescuing people stuck in deserts and developed a mobile application to receive requests for assistance. 

Last month, Dubai had to endure the towering task of clearing its water clogged roads and drying out flooded homes after a record storm saw a year’s rainfall in a day. Dubai International Airport, a major travel hub, also struggled for days to clear a backlog of flights and many roads were still flooded in the aftermath of the deluge.

The rains were the heaviest experienced by the United Arab Emirates in the 75 years that records have been kept. 


Pakistan court reserves verdict on plea by Imran Khan’s wife to be moved out of house arrest

Updated 02 May 2024
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Pakistan court reserves verdict on plea by Imran Khan’s wife to be moved out of house arrest

  • Bushra Bibi has requested court to shift her from Bani Gala home to Adiala Jail where Khan is also imprisoned 
  • Bushra has been handed two sentences, 14 years in graft case and 7 years for violating Pakistan's marriage law 

ISLAMABAD: The Islamabad High Court (IHC) on Thursday reserved its verdict on a petition filed by ex-premier Imran Khan’s wife Bushra Bibi seeking her transfer form her Banigala residence, declared a sub-jail, to Adiala Jail, where her husband is incarcerated.

Bushra has been living under house arrest at her husband's sprawling Bani Gala mansion in Islamabad since Jan. 31 when both were sentenced to 14 years in prison in a case that relates to accusations they undervalued gifts from a state repository and gained profits from selling them while Khan was prime minister from 2018-22.  Khan is jailed at Rawalpindi's Adiala Jail. 

In February, Khan and his wife were also sentenced to seven years on charges they violated the country's marriage law when they wed in 2018 - the fourth sentence for Khan and the second for his wife.

During Thursday’s hearing, Bushra’s lawyer Usman Gill said after her sentencing in the state repository case by the trial court, his client went to Adiala Jail as per the trial court order’s which was also forwarded to the jail superintendent. But on the orders of the interior ministry, the chief commissioner issued an “illegal notification for transfer,” the lawyer argued. 

“There was no instruction from the authorities concerned regarding the transfer from Adiala Jail to Banigala,” he said.

“Neither the provincial government nor did the Punjab prisons inspector general issue any such directive [for transfer] … The place of imprisonment was to be determined by the trial court and not the chief commissioner.”

The state’s counsel argued that Bushra was moved to Bani Gala because of security threats. 

“Were the 141 women who were brought to Adiala after Bushra less privileged?” the judge hearing the case asked, saying they too should be imprisoned at their houses then.

“Sometimes you say that [you] cannot present her [Bushra] in the court as there are threats and at times, you say that the jail is not secure. Are you secure?” the judge quipped. “If I am confined in my home by my own will, I would be very happy but how can a prisoner’s property be turned into a sub-jail against his will?”

The IHC subsequently reserved its verdict on the petition.

In a separate petition to the court filed last month, Bushar, a deeply religious woman widely believed to be Khan’s spiritual guide, alleged she was being poisoned through contaminated food and subjected to “mental and physical torture which is becoming a serious threat to her health and life.” She also alleged that her room and bathroom had been bugged and multiple hidden cameras installed in a “blatant violation of her privacy, dignity and honor.”

The petition said Bushra was only given ten minutes for meetings with family members and lawyers, with five jail staff supervising at all times.

Khan was first jailed after being handed a three-year prison sentence in August 2023 by the Election Commission for not declaring assets earned from selling gifts worth more than 140 million rupees ($501,000) in state possession and received during his premiership. In January, Khan and Bushra were handed 14-year jail terms following a separate investigation by the country’s top anti-graft body into the same charges involving state gifts. 

An anti-graft court in Islamabad also handed Khan a 10-year jail term in January for revealing state secrets, a week before national elections on Feb. 8. The ruling on his marriage to Bushra and a seven-year sentence each for both also came ahead of the polls.

Khan has also been indicted under Pakistan's anti-terrorism law in connection with violence against the military that erupted following his brief arrest related to the Al-Qadir case on May 9. A section of Pakistan's 1997 anti-terrorism act prescribes the death penalty as maximum punishment. Khan has denied the charges under the anti-terrorism law, saying he was in detention when the violence took place. 

Khan’s convictions, which mean he is banned from holding public office, ruled the 71-year-old out of general elections held earlier this year. Arguably Pakistan's most popular politician, Khan says all cases against him are motivated to keep him out of politics.


Pakistan PM’s recent Saudi visit ‘most successful in decades’ — information minister

Updated 02 May 2024
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Pakistan PM’s recent Saudi visit ‘most successful in decades’ — information minister

  • Shehbaz Sharif was in Saudi Arabia from April 27-30 where he met crown prince, several top Saudi ministers
  • “High-powered” delegation of Saudi businessmen due in Pakistan in “few days” to discuss private sector investments 

ISLAMABAD: Pakistani Information Minister Attaullah Tarar said on Friday Prime Minister Shehbaz Sharif’s recent visit to Saudi Arabia was the most successful tour to the Kingdom in decades by a Pakistani leader, with the premier holding at least twelve meetings, including with the crown prince.

Sharif was in Riyadh from Apr. 27-30 to attend a special two-day meeting of the World Economic Forum on global collaboration, growth and energy. On the sidelines of the WEF conference, Sharif met and discussed bilateral investment and economic partnerships with Crown Prince Mohammed bin Salman and various top officials from the Kingdom. 

This was Sharif’s second meeting with the crown prince in a month. Before that he also met him when he last traveled to the Kindom on April 6-8.

“Such a successful tour of Saudi Arabia has not been seen in decades,” Tarar told a press briefing on Friday, speaking about Sharif’s recent trip to Riyadh for the WEF special meeting. “With Saudi ministers, the process of meetings went on for two days.”

Among those Sharif met were the Saudi ministers of finance, industries, investment, energy, climate and economy and planning, the adviser of the Saudi-Pakistan Supreme Coordination Council and the presidents of the Saudi central bank and Islamic Development Bank.

“PM had twelve meetings in two days which has not happened in history,” Tarar said. “And in the meetings every minister came and told us that it was the order of Crown Prince Mohammed bin Salman that they had to do efforts for Pakistan and cooperate with Pakistan and we have come to tell you we will do whatever we can for investments in Pakistan.”

Tarar said a “high-powered” delegation of Saudi business people and heads of major Saudi companies would be in Islamabad in the “next few days.” 

“Delegation is coming to islamabad and we have planned a big program for investment in the private sector,” the information minister added. 

Pakistan and Saudi Arabia enjoy strong trade, defense and cultural ties. The Kingdom is home to over 2.7 million Pakistani expatriates and serves as the top source of remittances to the cash-strapped South Asian country.

Both Pakistan and Saudi Arabia have been closely working to increase bilateral trade and investment deals in recent weeks, and the Kingdom recently reaffirmed its commitment to expedite an investment package worth $5 billion.

Cash-strapped Pakistan desperately needs to shore up its foreign reserves and signal to the International Monetary Fund (IMF) that it can continue to meet requirements for foreign financing which has been a key demand in previous bailout packages. 

Saudi Arabia has often come to Pakistan’s aid in the past, regularly providing it oil on deferred payments and offering direct financial support to help stabilize its economy and shore up forex reserves.


PIA operations to Dubai, Sharjah ‘severely affected’ due to UAE rains

Updated 02 May 2024
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PIA operations to Dubai, Sharjah ‘severely affected’ due to UAE rains

  • Extreme weather in UAE expected to continue until Friday, authorities have issued safety advisories for residents
  • Latest rains come two weeks after Dubai was hit by unprecedented storms that paralyzed the emirate for days

KARACHI: Pakistan’s national carrier PIA said on Thursday its operations to Dubai and Sharjah had been “severely affected” by a latest spell of heavy rains in the UAE and would remain suspended until further notice.

UAE residents woke up to heavy rain, thunderstorms, and strong winds on Thursday morning, as predicted by the UAE’s National Center of Meteorology (NCM) on Wednesday, May 1. The extreme weather is expected to continue until Friday, May 3, and authorities have issued safety adviseries for residents.

The latest rains come two weeks after Dubai was hit by unprecedented storms that paralyzed the emirate for days.

“Air operations to Dubai and Sharjah are severely affected due to heavy rains in UAE,” PIA said in a statement. “Air operations of other airlines including PIA will remain suspended for the time being.”

The airline said passengers of affected flights should contact PIA call center 786 786 111 for their flight information and alternative arrangements.

Last month, Dubai had to endure the towering task of clearing its water clogged roads and drying out flooded homes after a record storm saw a year’s rainfall in a day. Dubai International Airport, a major travel hub, also struggled for days to clear a backlog of flights and many roads were still flooded in the aftermath of the deluge.

The rains were the heaviest experienced by the United Arab Emirates in the 75 years that records have been kept. They brought much of the country to a standstill and caused significant damage, flooding trapped residents in traffic, offices and homes and overrunning malls and roads. 
 


In scenic Abbottabad, an old church tells a tale of religious unity, colonial heritage

Updated 02 May 2024
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In scenic Abbottabad, an old church tells a tale of religious unity, colonial heritage

  • St. Luke’s Church was built in 1864 on land donated by Queen Victoria, empress of India
  • Can seat up to 150 worshippers, expanding into outdoor area to host larger crowds

ABBOTTABAD: Located in Abbottabad, a picturesque city set against the mountainous terrain of Pakistan’s northwestern Khyber Pakhtunkhwa province, the 160-year-old St. Luke’s Church has a tale to tell of religious unity and the region’s colonial history. 

Built in 1864 during British rule, the Anglican-Protestant church was established to serve British officials serving in the Indian subcontinent. Construction of St. Luke’s commenced in 1854-55, with initial delays due to slow fund-raising and then a brief interruption due to the Indian Rebellion of 1857. It was completed and then consecrated by the Bishop of Calcutta in 1864. 

Despite disruptions during the partition of British India in 1947 and the birth of Pakistan, the church has continued to host mass and retained many of its original architectural elements.

“During its construction, the church’s exterior was built with stones that were cut and laid by hand,” Rev. Rafiq Javed, a priest at the church appointed by the Diocese of Peshawar, told Arab News this week, explaining the history of St. Luke’s Church.

“The inner part [of the church] is built using mud, lentils, jute, sawdust, and paste made of eggs. The eggs were provided by the local people.”

St. Luke’s Church retains many elements from the time of its construction, such as stained-glass windows and old locks and their gigantic keys. A pipe organ stands in the church foyer.

Javed said the musical instrument had become unusable due to water damage some 50 years ago but its sound was once well known across the Abbottabad valley.

The church walls display plaques dating back to 1865 and serving as a memory of fallen British soldiers. One also comes across a metallic device permanently fixed on one of the stairs at the church’s entrance that was used by British troops to remove mud from their shoes before going to the main hall for worship.

The local Christian community says the church property was donated by Queen Victoria, empress of India, and one of its gates was named after her. The church property comprises the vicar’s home as well as staff quarters for caretakers of the building.

The church seats up to 150 worshippers, expanding into the outdoor area to accommodate larger crowds during special occasions such as Christmas and Easter.

Christianity, the third largest religion in Muslim-majority Pakistan, is followed by 1.27 percent of the population, according to the 2017 Census. The community has roughly equal proportions of Catholics and Protestants, with a small number of Eastern Orthodox and Oriental Orthodox Christians as well. There are around 4,000 Christians in Abbottabad, according to local estimates.

Javed the priest said the building of the church was a community effort:

“At the time, the people who lived here included Hindus and our Muslim brothers as well and they also lent a hand in building this church. The eggs [to make paste] were provided by the local Hindu and Muslim communities.”