When did State bank of Pakistan (SBP) make it mandatory to install Bio-metric machines in bank branches?

SBP vide BPRD Circular Letter No. 13 dated June 08, 2015 (link) advised Banks/DFIs to make use of bio-metric technology at the branch level for verification of particulars of prospective customers.

What is the purpose of Bio-metric verification in banks?

The purpose of bio-metric verification is facilitation of customers by instant verification of their particulars through an advanced technological verification tool.


State bank of Pakistan circular issued for Bio-metric verification of non-resident/ oversees Pakistanis

Please refer to Para 5.a of BPRD Circular Letter No. 18 dated October 19, 2018 on the above subject.

In this regard, based on the representations received from various stakeholders, including overseas Pakistanis, following instructions regarding bio-metric verification of existing customers presently outside Pakistan are being issued:

S.No. Type of Customer Treatment
1

Non-resident Pakistanis (NRPs)

As defined in Income Tax Ordinance, 2001 – Chapter 5, Division II, Section 82

For customers who fall under the definition of NRP, the bank/ DFI may obtain a signed undertaking from the customer invariably containing the following:

1) Customer’s NRP status along with proof (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.)

2) Copy of valid ID document (CNIC/ NICOP)

3) Account number(s) of the customer’s account(s) maintained with the bank as per customer record

4) Undertaking by the customer to inform the bank of any change in residency status

5) The bank/ DFI, after verification of the customer’s signature from its record, shall accordingly update/ reflect the NRP status in the customer profile.

For such customers, as an alternative to bio-metric verification, the bank/ DFI may conduct fresh NADRA Verisys using the information provided by the customer.

2 Joint Accounts
where one account holder is outside Pakistan (NRP/ temporarily)
For joint account holders, treatment of bio-metric verification should be done according to the status of respective individual. Bio-metric verification should be conducted for the joint account holder who is resident Pakistani, while for other joint account holders, the relevant procedure described at (a) and (b) above should be adopted.



State bank of Pakistan has exempted non-resident Pakistanis (NRPs) from bio-metric verification

The State Bank of Pakistan (SBP) has exempted non-resident Pakistanis (NRPs) from bio-metric verification and has allowed them to continue operating bank accounts in the country as the verification is aimed at unearthing fake accounts to combat money laundering and terror financing.

What is Development financial institutions (DFI)?

DFIs are government-controlled institutions that invest in sustainable private sector projects with the twofold objective of spurring economic activities in the country while themselves remaining financially viable.

  1. Pak Oman Investment Co. Ltd.
  2. Pakistan Industrial Credit & Investment Corporation.
  3. Saudi Pak Industrial & Agricultural Investment Co. Ltd.
  4. Pak. Libya Holding Co. Ltd.
  5. Pak Kuwait Investment Co. Ltd.



Bank/ DFIs may conduct fresh Nadra verification instead of bio-metric verification

For such customers, “as an alternative to bio-metric verification”, banks and development finance institutions (DFIs) may conduct fresh NADRA (National Database and Registration Authority) Verisys by using the information to be provided by the customer, the central bank said in a notification issued to remove hurdles in the way of NRPs using bank accounts in Pakistan.

The central bank issued the fresh directives to banks and DFIs after some of the NRPs complained of blocking of their bank accounts.


June 30, 2019 is the last date of bio-metric verification for all type of banks and DFIs

The last date for the bio-metric verification for all types of bank and DFI customers is June 30, 2019. Foolproof measures to combat money laundering and terror financing are a must to avoid the blacklisting of Pakistan by Paris-based Financial Action Task Force (FATF).

Banks/ DFIs may obtain a signed undertaking for NRP customers

“For customers who fall under the definition of NRP, the bank/DFI may obtain a signed undertaking from the customer invariably containing. Customer’s NRP status along with proof ie copy of valid passport, visa, exit stamp, resident permit, etc,” the SBP said in the notification.


Documents that NRP needs to submit to their banks

The documents, the NRPs are asked to submit as proof include as follows:

  1. Copy of valid identity documents i.e. computerized national identity card (CNIC) and/or
  2. National identity card for overseas Pakistanis (NICOP),
  3. Account number(s) of the customer’s account(s) maintained with the bank as per customer record, and
  4. Undertaking by the customer to inform the bank of any change in residency status.



Bank/ DFI after due verification update the NRP status

The bank/ DFI, after verification of the customer’s signature from its record, shall accordingly update/reflect the NRP status in the customer profile.

Bank/ DFIs may ensure the authenticity of the customer identification document

In the absence of bio-metric verification, the bank/DFI may ensure that requisite identification document has been obtained, marked as ‘original seen’ by their staff and verified through NADRA Verisys.


Moreover, an undertaking should be obtained from the customer declaring that the particulars provided to the bank/ DFI are correct and their staff has verified the same. The declaration should be endorsed by the branch manager and should be available in the bank’s centralized record.

Residents temporarily outside Pakistan

For customers who do not come under the definition of NRP, but are currently or temporarily outside Pakistan for any reason, the bank/DFI may obtain reasonable evidence and proof from the customer regarding his or her absence from the country (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.) and the expected date of return.


Bank/ DFIs may conduct fresh Nadra verification instead of bio-metric verification for customers temporarily outside Pakistan

For such customers, as an alternative to bio-metric verification, the bank/DFI may conduct fresh NADRA Verisys by using the information provided by the customer.

The Nadra verification for temporary outside customers shall not be retained by more than 6 months

The bank/DFI may retain the NADRA Verisys in place of bio-metric verification until the customer returns, subject to reasonable time limit (not more than six months) to be defined by banks/DFIs.


Bio-metric verification of such customers shall be done immediately upon the customer’s return to the country.

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Source: Tribune