In exercise of the powers conferred upon State Bank of Pakistan under Payment Systems & Electronic Funds Transfer Act, 2007, it has been decided to allow Direct Membership of Cheque Clearing House to Microfinance Banks (MFBs) without acquiring membership of Pakistan Real time Interbank Settlement Mechanism(PRISM) system, subject to the following conditions:-|

i. MFBs shall enter into comprehensive Service Level Agreements (SLAs) with the Clearing House for this purpose;

ii. The Clearing House will prepare Separate Clearing Batches of instruments drawn on and presented by MFBs and provide the same to PRISM for settlement on Multilateral Net Settlement basis. However, PRISM membership will not be mandatory for MFBs;

iii. All MFBs are required to maintain adequate funds / liquidity in their Current Accounts with SBP BSC (Bank), Karachi, based on their existing and future clearing requirements. MFBs shall constantly monitor and replenish funds in their Current Accounts to mitigate the Liquidity/Settlement Risk. Further, MFBs are required to establish Funding Arrangements (FA) / Credit Lines (CL) with Direct Participants of PRISM, enabling Direct Participants to replenish MFBs Settlement Account as and when required within stipulated time. Confirmation of this arrangement should be sent to Payment Systems Department (PSD), SBP prior to the commencement of the Separate Clearing Batch Mechanism.

iv. In case any MFB is unable to settle their clearing obligations within thirty (30) minutes time, SBP may take penal action including levying of penalties under applicable laws.

2. Mechanism of Separate Clearing Batch Processing for Microfinance Banks is enclosed at Annexure “A”.

3. This arrangement will be effective from November 15, 2015.

4. In case of any queries, please contact Mr. Muhammad Khalid, Joint Director (Ph. No.021-32453414; email: [email protected]) PSD, SBP, Karachi.


Please acknowledge receipt.

Encl: Annexure "A"