ISLAMABAD: The State Bank of Pakistan (SBP) has directed banks across the country not to freeze or restrict customers’ bank accounts without legal authority and approval from the competent authority, issuing fresh guidelines in compliance with an Islamabad High Court (IHC) order.
According to the central bank’s directive, banks must ensure that any debit block, operational restriction or account freeze is imposed strictly in accordance with the law and only after obtaining authorisation from the relevant competent authority.
The SBP said no action should be taken against a customer’s account unless there is clear legal authority and proper verification.
The central bank also instructed commercial banks to establish internal mechanisms to ensure full compliance with the new guidelines and prevent customers from suffering unnecessary losses due to precautionary or inadvertent account restrictions imposed without lawful authority.
It said the internal controls should ensure that account holders are not adversely affected by freezes or operational blocks carried out without legal grounds or the required approvals.
The new instructions follow directions issued by the Islamabad High Court, which barred banks from freezing accounts without legal authority or approval from the competent authority.
Justice Arbab Muhammad Tahir had directed the State Bank to formulate an internal mechanism and issue guidelines to commercial banks to ensure compliance with the court’s order.
The SBP has also submitted a compliance report to the Islamabad High Court outlining the steps taken to implement the court’s directives.
