The State Bank of Pakistan (SBP) has introduced a new mechanism for the sale of Premium Prize Bonds and issued important instructions to commercial banks regarding the settlement and reporting of transactions.
Under the new system, commercial banks have been directed to settle the proceeds from Premium Prize Bond sales on the same day. The SBP said the revised mechanism was introduced after reviewing the existing procedure for reporting Premium Prize Bond sale transactions.
According to a circular issued by the central bank, banks will be required to report details of Premium Prize Bond sales through the Data Acquisition Portal within the prescribed timeframe. Based on the reported sales, the SBP Banking Services Corporation will debit the respective bank account on a daily basis.
The SBP clarified that banks failing to settle the sale proceeds on the same day will be required to pay charges for using the funds during the period of delay. These charges will be calculated for each day of delay at the SBP’s overnight reverse repo rate (ceiling).
The circular stated that the calculation and recovery of these charges will be carried out by the SBP’s Karachi office. The amount will be debited from the relevant bank account and credited to the Central (Non-Food) Account.
The central bank further warned that if incorrect, delayed or incomplete reporting of sales, encashment or transfer transactions results in the erroneous payment of profit or prize money, the concerned bank will bear full responsibility.
However, where applicable, adjustments will be made for the amount of income tax involved in such transactions.
Read also: Have a Prize Bond? Check How Much Tax Could Be Deducted
