For SBP Banking Services Corporation, the Financial Year 2018-19 has been a year of significant achievements. The Corporation continued to achieve excellence in providing quality services to its customers and stakeholders. It gives me immense pleasure to lead an organization with such a profound sphere of operations, being performed as the subsidiary of the State Bank of Pakistan.
One of the prime functions of SBP BSC, in this capacity, is the provision of efficient banking services to the Government at various tiers to viz. Federal, Provincial and District. In addition to this, the Corporation also serves as a Banker to the banks as well as the DFIs, besides providing various banking services to State Bank of Pakistan and its other subsidiaries. These services are primarily performed by 16 Field Offices and a wide network of authorized branches of National Bank of Pakistan and Bank of Punjab. Accounts Department of the SBP BSC is responsible for technical and operational support, data collection and consolidation, and reporting to SBP and major Government Authorities.
In line with SBP Vision 2020, SBP BSC brought critical improvements in key operational areas of payment and financial systems, which include providing technical and operational support to SBP in rolling out government collections through alternative delivery channels (ADC). The taxpayers using ADC now directly deposit their dues in government accounts through ATMs and internet banking without visiting bank branches. Moreover, ADCs have enabled participation of all commercial banks in government collection.
SBP Banking Services Corporation also processes transactions of government payments/receipts, collection of tax proceeds and Zakat collection. For the purpose of payment of sales tax refunds, the payment through Electronic Fund Transfer (EFT) mode was launched last year. Thousands of sales tax refunds are now being directly credited into the bank accounts of respective taxpayers instead of using the previous practice of handing them over the cheques. SBP BSC has also moved from one- cheque-per-person to one-cheque-per-bank system for military cheques issued by Controllers of Military Accounts and Naval Accounts in various cities. Going forward, similar consolidation is going to be adopted in other Government payments as well. The upgrade to T-24 platform as the core banking system has resulted in improved system performance, better control environment and robust disaster recovery options.
The tremendous increase in the Notes-in-Circulation (NIC) poses a serious challenge of smooth distribution of fresh notes, and lifting of high quantum of soiled notes from the market for subsequent destruction. To meet such an increased demand of bank-notes, Currency Management Department (CMD) at BSC has recently taken various initiatives to ensure smooth and consistent supply of fresh notes especially during religious festivals. On similar footing, SBP BSC field offices have been outperforming the high destruction yearly targets assigned to them.
In addition to this, 8877 SMS service has recently proven to be a huge success that involves distribution of fresh currency notes through designated branches of commercial banks and field offices of SBP BSC. The service facilitates millions of customers every year. To mitigate downtime of ATMs on Eid occasion, SBP BSC deployed dedicated inspection teams and initiated a real time
complaint management through WhatsApp groups, which has improved the availability of cash in ATMs across the country.
SBP BSC has also been successfully promoting “Interbank Exchange of Cash” platform as a pure market mechanism enabling banks to handle daily demand/supply of fit banknotes independently. It is expected that this will eventually limit the role of SBP BSC to only issue fresh notes, and receive soiled notes for destruction.
SBP BSC also continued to modernize and automate its currency operation under the umbrella of Currency Management Strategy (CMS). After three years’ successful operations of high-end system at SBP BSC Karachi, SBP BSC is in the advanced stage of procuring state-of-the-art processing, authenticating, and destruction systems for other major field offices. Likewise, all field offices have been equipped with desktop and countertop notes sorters for processing of heavy amount of cash, and ensuring provision of 100% machine authenticated banknotes at their cash counters. All of these are significant achievements, paving way for a modern and fully automated cash market in Pakistan.
SBP BSC also manages various popular government saving schemes on behalf of Central Directorate of National Savings (CDNS). Various new SoPs are in place to improve services at sale/encashment counters. In particular, options have been allowed for advance stamping of prize bonds, and sale/purchase of multiple denomination bonds at the counter. A successful pilot launch of electronic queue management system eQMS) was conducted at North Nazimabad office, Karachi. Based on the learnings of this pilot, all other offices have also started preparations to implement eQMS.
SBP BSC also gives great importance to premium prize bonds for its potential for future expansion. SBP BSC has increased the outreach of premium bonds by offering its sale through branch network of six large commercial banks. This approach would enable the much-needed scale-up so that every customer would have easy and fast access to premium bond sale and encashment.
Foreign Exchange (FX) is the lifeline of every economy. Against the backdrop of recent challenging economic developments in Pakistan, FX has gained rich prominence. At SBP BSC, Foreign Exchange Operations Department (FEOD) has been lending a reliable and effective support to FX regime of SBP by meticulously following and implementing FX policies related to trade, commercial and private remittance. Operational Efficiency of functions of the department have improved by large-scale automation and enhanced capacity of the workforce.
Web-Based One Customs (WeBOC) was implemented by FEOD in coordination with Pakistan Customs for better monitoring and control. Processing mechanism of new schemes of textile and non-textile had been revised, removing all redundant steps. In addition, FEOD is also in the process of establishing Electronic Data Interchange (EDI) with Customs Department to further enhance the capacity to monitor FX operations relating to trade. The Department is also entrusted with the responsibility of making payment to exporters under various schemes. A meticulous compliance to instructions of SBP and other government authorities are ensured in disbursement of funds.
The functions of FEOD are supported by FEAD courts handling complaints regarding violation of various laws and codes, and levying penalties. Various new courts have been established and the SOPs for recovery have been revamped resulting in improved recovery.
SBP BSC is supporting SBP in developing a market-based inclusive financial system catering to the financial needs of all segments of the economy. Implementation of broad-based policies and targeted interventions are underway to foster growth of three priority areas i.e. SMEs, Agriculture & Housing Finance.
The launch of a five-year National Financial Literacy Program (NFLP) has paved way to provide access to transaction accounts by unbanked population, which can in turn become a gateway to other financial services. The program was rolled out across various districts of Pakistan through SBP BSC field offices in collaboration with commercial/microfinance banks and partner institutions (NGOs, Microfinance Institutions and Rural Support Programs) with the aim to reach 1 million beneficiaries including 50% women in five years. Besides, SBP BSC has also rolled out NFLP Student Ambassador plan which engaged university students to deliver NFLP sessions in their summer/winter vacation.
Over the years, SBP has introduced special schemes under its refinance window to ensure adequate supply of financing to the value added industries at concessionary rates for enhancing their production capacity and meeting working capital requirements. SBP BSC has taken various measures to implement and monitor proper utilization of funds disbursed under these concessionary financing schemes. As part of its Credit Guarantee Schemes, SBP BSC has been issuing guarantees against financing in different business sectors in order to support broad based financial growth. The objective of the guarantee schemes is to encourage financial institutions to lend to enterprises, which do not have adequate collateral in order to meet their working capital requirements.
Human Resource Management Department (HRMD) of SBP BSC has been entrusted to drive the hiring and training process for the organization, among other responsibilities. The Department continued to strengthen the process of hiring various initiatives like direct recruitment through YPIP batches. Such measures are keeping up the supply of quality HR to meet the needs, which have been determined under the organization-wide workload analysis. Additionally, the automation projects such as implementation of Biometric and Access Control System (BACES) and Executive Letter Management System (ELMS) at HOK with future goal of its implementation at all field offices will help in improving operational efficiency. This also contributes towards long-term goal of achieving paperless environment.
Training presents a prime opportunity to expand knowledge base of employees providing them opportunities for personal growth in line with business needs of the Bank. Accordingly, SBP BSC has been nominating its officials for trainings through multiple modes and at prestigious institutes such as NIBAF, IBA, LUMS, PSTD, IBP etc along with foreign training institutes.
The dynamic nature of business at SBP and its subsidiaries demand provisions of continuous support and efficient services and these services act as background enabler in various initiatives undertaken by the organizations. General Services Department (GSD), Engineering Department and Internal Bank Security Department (IBSD) have always ensured provision of common support services to
SBP and its subsidiaries in a smooth and efficient manner. GSD has been playing a pivotal role in facilitating various departments in achieving their targets/goals by offering robust procuring services of goods and services, thus contributing to the fulfillment of strategic objectives of SBP, SBP BSC and NIBAF. Among the other areas of GSD, Healthcare remained at forefront in providing best- available medical facilities to employees and their families. Similarly, the importance of the printing press cannot be undermined, hence the printing services from GSD has always been and is at par with the demand and has been keeping up the smooth running of affairs.
Considering the prevailing security environs of the country especially in wake of various security challenges, the role of IBSD has gained prominence in ensuring safe, secure and conducive work environment for the employees of SBP, SBP BSC and NIBAF. Various initiatives like conducting Regular Physical Efficiency Tests (PET) of the guards, and training of the personnel have been taken for managing varying level of security threats to the organization. The development of security personnel and staff is an ongoing feature exercised by IBSD in keeping itself abreast with the upcoming changes in security challenges.
Engineering Department has rendered various services to improve the physical environment of various buildings and departments of SBP and its subsidiaries. Various upgradations related to electrical, telecommunication, civil and HVAC systems are being carried out in buildings of SBP, SBP BSC and NIBAF. The Department has been working on electronic platform for improvement of its procurement activities through e-Procurement system.
All the above mentioned business processes are only effective with an effective internal control environment. Internal Audit Department (IAD), through its continuous assessment and subsequent improvements has been playing vital role in this regard. Initiatives like the capacity enhancement of IMUs at field offices arranging trainings, Audit Conferences and constitution of Audit Forum have provided further traction to the SBP BSC’s goal of achieving robust control for its business processes. Further, realizing the crucial role of technology in SBP BSC’s operations, IAD is exploring the concept of “Technology risk Assessment” to further reinforce the organization’s internal control mechanism.
Despite our significant successes in the outgoing year, we are not oblivious to the need for pursuing excellence. We are keeping a close eye on the market trends and evolving needs of the stakeholders. We are committed towards providing intelligent solutions to dynamic business needs. To achieve this, we will continue to plan and invest in innovation and governance, and will try to keep ourselves ahead of the curve.
At the end, I would like to thank the management team, officers and staff of SBP BSC for their unwavering efforts towards achievement of strategic objectives of the organization and I expect that they shall continue with even greater enthusiasm and diligence. I acknowledge with deep appreciation the support and guidance of the Governor, SBP and SBP BSC Board. I am hopeful that the management’s philosophy of integrity, accountability, teamwork, excellence and result- orientation shall continue to serve as the basic principles for the employees of SBP BSC. Together with the support of our stakeholders, SBP BSC will achieve greater milestones in the years to come.