SBP enables cash deposit transactions in merchant accounts

• As per the revised amendments in ‘Regulations for Digital On-boarding of Merchants,’ Banks/MFBs shall ensure that Merchant Accounts are only used for digital collection of payments.

The State Bank of Pakistan (SBP) has allowed cash deposit in merchant accounts, after making amendments in ‘Regulations for Digital On-boarding of Merchants.’

As per the revised amendments in ‘Regulations for Digital On-boarding of Merchants,’ Banks/MFBs shall ensure that Merchant Accounts are only used for digital collection of payments against the provision of legitimate goods and services. However, cash deposits into these accounts are permitted subject to following terms and conditions:

• All customers including Branchless Banking level “0” accountholders can top up/cash in their accounts up to Rs. 10,000/- per month through biometrically verified merchants. However, cash deposit shall only be used for digital payments.
• Total cash deposit in merchant accounts shall not exceed Rs. 100,000/- per month.

However, Banks/MFBs shall not permit cross border outward remittance transactions from these accounts. Meanwhile, all other instructions on the subject regulations shall remain the same.

The central bank said on Monday that the policy mix appears adequate to address the macroeconomic imbalances and push the economy towards stability as Pakistan's economy moved progressively along the adjustment path during the first quarter (July-Sep) of this fiscal year (FY20).

The State Bank has also predicted that Pakistan is likely to miss the real GDP growth target of 4 percent for this fiscal year (FY20) mainly due to subdued performance of agricultural and manufacturing sectors.