SBP Devises Rules for Banks to Stop Malpractices of Selling Bancassurance

The State Bank of Pakistan (SBP) has devised a code of conduct for banks to improve the business practices of bancassurance or third party products through their channels and branches, which are often based on misdeclaration and over commitments. In addition to the banking services, banks often offer or sell other financial products that are provided by other financial institutions, generally referred to as bancassurance or third-party products. ALSO READ Senate Committee Directs SECP To Conduct Forensic Audit of HASCOL Such offers are often prone to misdeclaration about the quality or pricing of products. Further, banks also don’t assume any responsibility after the sale of products, which leads to difficulties for customers and disputes. To address such concerns and bring transparency to such transactions, SBP has issued a comprehensively revised set of instructions on the sale of third-party products. In addition, these instructions will also facilitate the sale of products through digital channels and promote financial inclusion. The key features of the revised instructions are as follows: ALSO READ Pakistan Receives $2.75 Billion From IMF The instructions will be applicable from November 01, 2021.