KARACHI (Dunya News) – State Bank of Pakistan has directed banks nationwide not to block or freeze accounts without legal justification, approval from a competent authority and proper verification.
Acting on court orders, the central bank issued fresh guidelines to all banks, instructing them to ensure that even precautionary or unintentional restrictions do not cause unnecessary hardship to account holders.
According to the new directives, any debit block, operational restriction or account freezing measure can only be imposed in accordance with the law.
The SBP further stated that action against any citizen’s bank account must only be taken after establishing clear legal authority and completing appropriate verification.
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Banks have also been allowed to develop internal compliance mechanisms to ensure full implementation of the directives and prevent unauthorized restrictions.
The central bank emphasized that such internal systems should ensure account holders do not suffer unnecessary losses due to precautionary measures or actions taken without lawful authority.
The move follows a ruling by the Islamabad High Court, which barred banks from freezing accounts without legal authority or approval from a competent authority.
Arbab Muhammad Tahir had directed the State Bank to formulate an internal mechanism and issue necessary instructions, after which the central bank submitted its compliance report to the court.