The Presidents / Chief Executives
All Schedule Banks

Dear Sirs / Madam,

BASIC BANKING ACCOUNT AND BANK CHARGES

Please refer to BPD Circular No. 30 dated November 29, 2005, on Basic Banking Account (BBA), BPD Circular No. 23 dated July 04, 2003, and BPD Circular No. 33 dated October 02, 2003, on service charges.

It has been observed that some banks are not taking adequate steps for promoting BBA as per SBP instructions and are imposing charges on customers for converting their account from regular full service banking account to BBA. It has also been observed that banks are also exorbitantly charging their regular account holders for not maintaining minimum monthly average balance with the bank. These practices are not only in violation of the instructions issued vide above referred Circulars but are also hindering the access of public to the banking services.

In order to address these issues, it has been decided in consultation with the chief executives of banks, that henceforth;

i) Banks shall not recover any BBA operating charges or charges for conversion of regular full service bank accounts to BBA.
ii) Banks shall not charge more than Rs.50/- per month as service charges from their regular account holders on maintaining balance below the minimum monthly average balance.

All banks/DFIs are advised to ensure compliance of the above instructions in letter and spirit as non compliance will attract punitive action under Banking Companies Ordinance, 1962.

Other Instructions on the subject will remain unchanged.

Please acknowledge receipt.