Can Banks Refuse ATM Cards to Illiterate Customers?"

Customer Banking Rights: Can Illiterate Individuals Be Denied ATM Cards?

By Usman Ahmad Jattala 

Introduction:

Financial inclusion is a cornerstone of economic empowerment, and in Pakistan, this includes ensuring that even illiterate individuals have access to banking services. A common question arises: Can banks refuse to issue ATM cards to illiterate persons?  Let's delve into the regulations and practices that address this concern.

Understanding the Regulations:

The State Bank of Pakistan (SBP) , which oversees banking operations, has set forth guidelines (SBP’s Payment System Department Circular No. 01 of 2021)  that aim to make banking accessible to all segments of the population, including those who are illiterate. While it is not mandatory for banks to issue ATM cards to illiterate customers, they cannot outright deny a request if an illiterate person demands such a service.

The Right to Request:

Illiterate individuals have the right to request an ATM card from their bank. The banks are required to take reasonable steps to accommodate this request, which includes providing necessary assistance and ensuring the individual understands the usage and risks associated with the card.

Security Measures:

When an illiterate person requests an ATM card, banks are expected to implement specific security measures. This may involve setting up biometric verification, such as thumbprint scans, to authenticate transactions, and providing oral instructions or demonstrations on how to use the card and ATM machines safely.

Legal Framework: 

The legal framework in Pakistan supports the financial inclusion of all citizens. The SBP’s guidelines reflect a commitment to ensuring that no individual is excluded from basic financial services due to illiteracy.

Financial Literacy Initiatives:

 Banks  in Pakistan are not only facilitating illiterate individuals with ATM card issuance but also investing in financial literacy programs. These initiatives aim to educate customers about basic financial services, the importance of savings, and how to use banking products safely and effectively.

Conclusion:

In conclusion, while banks in Pakistan are not obligated to automatically issue ATM cards to illiterate customers, they cannot refuse to do so if an illiterate person makes a request. It is the responsibility of the financial institutions to ensure that all customers, regardless of literacy, can access and utilize banking services securely and effectively.