The provision of financial services in rural and underserved areas is the key priority of the State Bank of Pakistan viz a viz to balance the distribution of branch network amongst different segments of the country. The Branch Licensing Policy (BLP) is one of the important tools available to SBP for allowing guided expansion of the banking system keeping in view requirements of the system and provides an insight into rationalization of the branch network.

2.        State Bank of Pakistan (SBP) since 2007 has liberalized the BLP with a view to allow the banks to make their branch networking within the broad policy parameters. Continuing with the same stance and to align policy with National Financial Inclusion Strategy, SBP has revised the existing BLP with the following objectives:

1. Introduction of Tier wise geographical distribution of new branches proposed under ABEP in different segments such as Big Cities, Other Cities, Rural and Underserved Areas (RUAs) and Unbanked Areas.
2. Guided road map for commercial banks to open their new branches during next 05 years in above mentioned Tiers. As a result, the RUA requirement (including unbanked areas) will be enhanced year wise from existing 20% in 2016 to 25 % by the end of FY 2021.
3. Introduction of criteria for up-gradation of sub-branches into full fledged branches.
4. Enhancement of scope of big cities from 13 to 18 big cities for the purpose of BLP.
5. Special instructions for banks regarding Accessible Banking Infrastructure for persons with Disabilities/ senior citizens /women as a part of banks corporate social responsibility and moral obligations.
6. Consolidation of existing policies/instructions issued on branch licensing from time to time.
7. Rationalization of some of the existing instructions for ensuring statutory/regulatory compliance.

3.        A revised BLP is attached herewith for information and strict compliance. The policy will become effective immediately.

4.        This supersede the existing instructions on BLP issued vide BPRD Circular No.15 of 2007, BPRD Circular No. 16 of 2009, BPRD Circular No. 2 of 2011, BPRD Circular Letter No.3 of 2011, BPRD Circular Letter No. 8 of 2011 and BPRD Circular No. 03 of 2012.

5.        Please acknowledge receipt.

Encl: As Above.