The Presidents / Chief Executives
All Banks /DFIs/MFBs
Guidelines on Prohibited Banking
Banking Conduct plays an important role in
building consumer confidence, which is fundamental
to the stability and efficiency of the banking
sector. Irresponsible business conduct can
undermine the confidence of the public in
the banking sector. Given the adverse consequences
for financial stability, irresponsible conduct
needs to be addressed proactively.
Accordingly, guidelines on prohibited conduct
have been developed in line with the best
international practices which will help in
bringing more clarity on regulatory expectations
on business conduct besides complementing
the existing SBP instructions issued from
time to time.
The guidelines have been categorized in
the following five areas:
1. Misleading conduct.
2. Undue influence & pressure.
3. Demand of undue considerations.
4. Collusion to fix features in the products/services
to the detriment of consumer.
5. Complacency not to invest in systems
and procedure, HR, consumer awareness, etc.
All banks/MFBs/DFIs are advised to incorporate
the same in their FTC framework by March
31, 2019 as per their scope of operations.
It is expected that the banks will review
their existing products and processes in
the light of these guidelines and ensure
its monitoring through adequate controls.
Besides, banks shall also undertake adequate
awareness measures to educate their staff
and consumers about prohibited banking conduct.
Please acknowledge receipt.
on Prohibited Banking Conduct