Pakistan Senate Bill Pushes against Discrimination of PEPs

Pakistan’s Senate Standing Committee on Finance unanimously approved a bill on 18 February 2022 that envisages punishments for bank and financial institution executives who discriminate against politically exposed persons (PEPs) and others in the providing of banking services.

The ‘Banking Companies Amendment Bill 2021’ was advanced in the Senate by Committee Chairman Talha Mahmood after multiple committee members complained of banks’ discriminatory attitude towards the granting of bank services to parliamentarians.

According to PakTribune, the proposed amendment in section 83 of the Banking Companies Ordinance (BCO) 1962 seeks to insert new wording:

“If an officer of the banking company or a schedule bank, as the case may be on the basis of creed, religion, gender, ethnicity, madressah or Islamic educational institute, class or group of citizens like politicians, government servants or teachers of the madressah, refuses to open an account, issuance of letter of credit, bank guarantee or any other financial facility only on the ground of politically exposed person, issues red alert or high- risk alert for business trade, without any sufficient restriction under any law, shall be punished with simple imprisonment for a term which may extend to one year, or with fine which may extend to one hundred thousand, or with both.”

The bill faces opposition from the Pakistan’s Ministry of Finance and the State Bank of Pakistan (central bank), who contend there is no need for such a law as the constitution provides equality to all citizens and the central bank has specifically advised all banks to follow ethical banking practices in customer dealings to avoid discriminatory practices against any segment of society, including PEPs.