Regarding the issue of providing International Banking Account Numbers (IBANs) to customers, an agreement with Faisal Bank was deemed essential, said the spokesperson of the Bank of Azad Jammu and Kashmir (BAJK).
MUZZAFARABAD ( WEB NEWS )
In a statement, the spokesperson of Bank of Azad Jammu and Kashmir (BAJK) addressed the recent agreement between BAJK and Faisal Bank. The spokesperson explained that the State Bank of Pakistan (SBP) and the AGPR (Accountant General Pakistan Revenues) had mandated that, for receiving any type of government payments—whether salaries, pensions, or other official payments—customers must provide their International Banking Account Number (IBAN). Following these directives, the AG office of Azad Jammu and Kashmir has made it mandatory for all government payees to provide their IBAN numbers, with a deadline set for September 30, 2024.
Since BAJK is still in the process of scheduling, it currently requires more time to directly provide IBAN facilities to its customers. To address this issue and facilitate customers, BAJK officers held a meeting with representatives from the AG Office, AGPR, and the State Bank. During the meeting, it was highlighted that a similar issue had been faced by the Karakoram Commercial Bank Limited (KCBL) in the past. KCBL resolved the issue by entering into an agreement with Faisal Bank, under which KCBL provided IBANs to its customers, enabling payments to be transferred to KCBL accounts.
Currently, the Bank of Azad Jammu and Kashmir has more than 12,000 government employees’ accounts, many of whom have taken advance salary loans. Given that no government payments can be made without an IBAN, the bank administration decided to promptly contact commercial banks to provide IBAN facilities for timely salary payments. To resolve the matter urgently, the bank entered into a preliminary agreement with Faisal Bank, rather than trying a new solution, ensuring customers do not face any inconvenience. Additionally, BAJK is in contact with two major national banks for further solutions.
On December 13, 2024, the Supreme Court of Azad Kashmir granted permission for the purchase of banking software for BAJK, but until BAJK attains scheduled bank status, it cannot issue IBANs independently. The AG office had set November 30, 2024, as the deadline to resolve this issue. If the bank cannot provide IBANs to its customers by this date, government payments such as salaries and pensions will not be transferred to BAJK accounts after November. Therefore, entering into an agreement with Faisal Bank is the only temporary solution to this issue.
It is important to note that agreements between banks are standard practice. The Bank of Azad Jammu and Kashmir has already entered into agreements with UBL and HBL for the convenience of its customers. This agreement with Faisal Bank has no bearing on BAJK’s efforts to achieve scheduled bank status, nor will it affect those efforts. To become a scheduled bank, two key conditions must be met: a minimum capital of 10 billion rupees and banking software. Progress is rapidly being made on both fronts. The process of purchasing banking software, which had been delayed for over a year, has now resumed, and a letter of intent has been issued to the successful bidder. After the installation of the software, BAJK will submit its application for a banking license.
As for the minimum capital, the government of Azad Kashmir is playing a vital role in achieving this target. The public is urged to disregard baseless rumors circulating on social media. Bank of Azad Jammu and Kashmir continues to perform excellently, having earned a record profit of over 1.7 billion rupees in the first eleven months of this year, setting a historic milestone, with even better results expected next year.