The State Bank of Pakistan (SBP) has directed all banks and microfinance banks across the country not to freeze customer accounts or impose operational restrictions without proper legal authority and approval.
The move came after the directions of the Islamabad High Court (IHC), which stated that banks must strictly comply with legal requirements before taking an action that affects a customer’s bank account.
SBP gave an official statement on June 15, 2026, and instruct the banks to ensure that debit blocks, account freezes, and other operational restrictions are only imposed after obtaining lawful authorization and completing all required verification procedures.
According to the central bank instructions were issued in compliance with an Islamabad High Court order dated June 2, 2026. The court had ruled that banks cannot place debit blocks or freeze customer accounts without any legal permit.
To strengthen the customer’s side, the SBP has directed all financial institutions to make effective internal systems to prevent unnecessary or unauthorized restrictions on customer accounts. The step is taken to ensure the account holders that they are not unfairly affected by precautionary or accidental actions lacking legal backing.
The central bank stressed that before taking any decision that affects a citizen’s bank account must be supported by valid legal authority and proper verification.
State Bank of Pakistan also instructed the banks to formally acknowledge receipt of the SBP’s directives before the Islamabad High Court and once they have compiled with the instructions they should inform the central bank through email.
During the court proceedings, Justice Arbab Muhammad Tahir mentioned that customer accounts should not be blocked without legal authority or approval from the competent authority. To ensure implementation of the court’s order, the court also directed the SBP to have a developed comprehensive internal compliance framework and issue necessary guidelines to all banks across the country.
Following the court’s orders, the State Bank of Pakistan submitted its compliance report to the Islamabad High Court after circulating the instructions to banks nationwide.
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This latest development will strengthen customer protections and improve transparency within Pakistan’s banking sector. By requiring proper legal authorization before restricting access to bank accounts, the new directive will protect the rights of account holders and banks will continue to operate within the legal framework.
According to financial experts the decision will increase public confidence in the banking system by ensuring that customers are not subjected to arbitrary account freezes or operational restrictions without due process.
Umar Daraz is the Founder and Editor of TodayEast, an independent digital news platform covering global affairs, business, technology, sports, and world rankings. He specializes in data-driven journalism, international news analysis, economic trends, and emerging technologies. Through TodayEast, he aims to provide accurate, accessible, and insightful reporting on the stories shaping the world.
