Business Desk 
Oct 03, 2024
In a bid to set aside the relevant problems and fulfil an increasing need, the State Bank of Pakistan (SBP) made amendments to its criteria for converting conventional banks into Islamic.
“All conventional banks having Islamic operations or those who intend to start Islamic banking operations shall be eligible to apply for conversion of its existing conventional branches into Islamic,” the SBP said in a circular.
The letter added: “No licensing fee shall be applicable on the conversion of conventional branches into Islamic,” it added.
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The criteria involve disclosures for account conversions, leveraging digital means to obtain customer consent for conversions, then using customer approval to convert current accounts from conventional to Islamic, and more.
Providing with essential information and informing potential customers will be ensured by the central bank of Pakistan as part of the measures it will undertake for a smooth transition of conventional banks into Islamic, The News reported.
Moreover, SBP will inform both the general public and concerned customers regarding the conversion of their respective conventional banks into Islamic at least three and a half months before the conversion, said the circular.
Prior to the conversion of individuals' current accounts, the central bank is likely to employ an acceptance approach with the approval of its Sharia board and clearance from the bank’s legal counsel, it said.
