Liquidity saturated banking sector in the face lesser
demand for project financing in the large manufacturing sector is coming
out with different innovative ideas to generate economic activity
especially in the micro-financing areas in Pakistan.
Unfortunately, the banking system in the past has
served the interests of the moneyed class or to the people having
political influence, while the masses could use the banking facility
merely for depositing their money and that's all. The uncalled for
complexities of the system in the name of prudent banking and the
unaffordable lending rates were among the major reasons causing bank
defaults but also kept the large manufacturing sector away from the
Micro-financing was effectively used for generating
economic activity in Bangladesh and Indonesia which can be successfully
followed in Pakistan also. However, the key to success is the low and
affordable lending rates which encourage the borrowers as well as
assures for the desired level of rate of recovery. The micro-financing
scheme could also be used as an effective tool for combating the
formidable task of poverty alleviation one of the important agenda of
the present government. So far the schemes announced by the banking
sector have been designed to serve the interest of the banking sector,
however, these schemes could be more meaningful if the growth of
economic activity at the grass root level is also kept in mind while
designing such schemes for the banks.
The State Bank of Pakistan which had already allowed
consumer financing and other micro advances is expected to allow Housing
Finance schemes to the commercial banks.
In a latest move, the banks and financial
institutions have been allowed mobile banking operations of
micro-finance banks and institutions.
In order to mitigate the risks involved in the mobile
operations of micro-financing, the central bank has however issued
guidelines for mobile banking operations of the micro-finance banks.
Under the legal framework for micro-finance
institutions, the micro-finance banks and institutions can undertake
mobile banking outreach of micro-finance services. These guidelines will
be applicable to mobile banking operations and will come into force with
The scheme allows opening of Service Centers within a
specified radius of the licensed branch, with prior permission in
writing from SBP. The areas and locations for these mobile operations
within district, city government limits which the bank has a licensed
branch or areas/location within a radius of 50 kilometers of the
incensed branch could be covered through mobile banking. The
micro-finance banks shall design the mobile banking operations in a way
which ensures cost effectiveness and financial viability of the
operation. In addition to provision of banking services through mobile
teams/vans, the banks engaged with scheme may also open small
outlets/service centers within the above defined area of the licensed
branch to provide a local contact point to the clients.
The Service centers shall have minimum infrastructure
manned by two-three bank staff and shall inter alia be mandated to
create awareness in the area about bank's products and form community
organizations/groups and provide loans to the clients.
The service Centers shall not offer savings/deposit
mobilization services and will not maintain overnight record or cash.
The record shall be maintained at the licensed branch under which the
service center would operate.
For the purpose of extending savings services, the
service center may notify the date and time, once or twice in a week, at
which the mobile van would be visiting the service center so that the
clients willing to avail savings services may deposit the savings etc
with the mobile team.
The license to open a branch in a particular area
shall also mean permission to undertake mobile banking within the
above-defined radium of the branch. The bank shall ensure
standardization while providing mobile banking services and shall
prepare a bank-wide mobile banking strategy in consultation with its
field staff highlighting its objectives, services to be offered,
frequency of visits, insurance, security, control mechanism, the
operating cost and record keeping etc. A copy of the complete strategy
shall be submitted to the state bank for information. The strategy shall
be reviewed semi-annually in the light of field experiences and other
developments in the sector.
The branch managers shall prepare quarterly mobile
banking plan keeping in view the demographic statistics of the areas to
be served and the overall mobile banking strategy of the bank. He or she
will assign areas to mobile teams, which will be rotated in the teams
periodically. Each mobile team shall prepare weekly plans and schedule
of its visits and get it approved by the branch manager. The manager
shall ensure that the teams' plans/schedules are in line with the bank's
overall mobile banking strategy and shall ensure its strict compliance.
The branch and mobile team plan shall be available in
the branch for review of internal/external audit teams and SBP