State Bank authorizes fees on interbank fund transfers – Journal
KARACHI: The State Bank of Pakistan on Wednesday allowed banks and other service providers to charge nominal fees on high-value transactions while low-income segments of the population will continue to use digital transactions for free.
After the emergence of Covid in the first quarter of 2020, the State Bank took a number of measures to deal with the extraordinary situation and advised banks and other service providers to offer free money transfer services. interbank (IBFT) to all their customers, regardless of their country of origin. the size of the transaction.
The SBP has now asked banks to provide free digital money transfer services to individual customers up to, at least, a minimum aggregate sending limit of Rs 25,000 per month per account or wallet. However, banks can also choose to set this overall limit at a higher amount. This would allow individual customers to complete as many free money transfer transactions remaining within their aggregate monthly free transfer limit.
For transactions exceeding the aggregate limit of Rs 25,000 per account in a month, banks may charge individual customers a transaction fee not exceeding 0.1% of the transaction amount or Rs 200, whichever is less. . This will allow service providers to recoup some of the costs they incur to provide an interbank money transfer service and build sustainable and innovative business models.
“Banks will surely make money with this decision when it would be a bit daunting for stakeholders. But it is not possible to go back to the checkbook system, ”said Samiullah Tariq, head of research at Pakistan Kuwait Investment (PKI).
At the same time, the digital system provides an additional facility to make a payment or withdraw money without going to the bank taking into account the bank’s schedule, he added.
During the Q1 FY21 review, PRISM (Pakistan Real Time Interbank Settlement Mechanism) processed 972,000 transactions valued at Rs 92,200 billion. These transactions showed a quarterly increase of 36% in volume while they showed a decrease of 1pc in value. In addition to interbank fund transfers (settlement transactions between participating institutions), PRISM has also facilitated clients through the ease of transfer of its clients which accounts for the largest share of 89pc in the total volume of PRISM transactions while the government securities transfer facility has the largest share of 65pc in terms of transaction value at the end of the 1st quarter.
During the quarter under review, online banking channels, namely RTOBs, ATMs, point of sale, e-commerce, mobile banking, internet and call centers handled a total of 253.7 million transactions worth Rs19.1tr. In the total number of e-banking transactions, ATMs have the highest share, 53pc of transaction volume. During the 2nd quarter of fiscal year 21, a total of 296.7 million transactions valuing Rs21.4tr were processed. ATMs handled the bulk with 51 pc.
During the quarter under review, PRISM processed approximately 1 million transactions for a value of Rs94.9tr. These transactions showed a quarterly increase of 3pc in value.
Now the situation has improved and encouraging regarding the Covid-19. “In this context, SBP has reviewed the current pricing mechanism of IBFT and made some changes to ensure that free IBFT services are provided by banks and other financial institutions on a sustainable basis,” the circular said.
The central bank said the new guidance encourages banks to provide free digital money transfer services to their customers to promote the adoption of digital payments in the country.
The SBP has also informed the banks that all digital fund transfer transactions between different accounts within the same bank (intrabank fund transfers) will remain free. In addition, incoming interbank fund transfer operations will also remain free. SBP further requested banks to ensure proper disclosure of IBFT invoiced and free amounts as well as applicable fees to their customers by sending regular notifications via SMS, apps and email.
After each digital transaction, banks are required to send free text messages to their customers on their registered cell phone numbers, notifying them of the transaction amount and any charges recovered.
Posted in Dawn, le 17 June 2021