State Bank eyes open banking ecosystem

The State Bank of Pakistan has opened its draft Open Banking Regulations for public feedback, Dawn reported on November 1. The proposed framework would require account-holding institutions to offer authorised third-party providers secure access to customer information and payment initiation, subject to customer consent and safeguards.

Under the draft, customer data would generally be kept and processed in Pakistan, with an exception for cloud services operating under the SBP’s outsourcing framework. The central bank says consent-based data sharing could support digital payments between businesses and consumers, while transaction histories could help assess creditworthiness and improve financing access for merchants and small and medium enterprises.

The proposal also addresses privacy, cybersecurity, fraud prevention and consumer protection. SBP is seeking views from financial institutions, fintechs, technology providers, consumer groups, academia and the public before refining the rules.