Pakistan is implementing IBAN standard16 May 2012 by Thomas Zink
The State Bank of Pakistan (SBP) has decided to implement International Bank Account Number (IBAN) standard to standardise account codes and increase efficiency in processing of payments for domestic as well as cross border transactions.
The IBAN guidelines issued by SBP contain details for IBAN generation, validation and implementation timelines. According to the guidelines, the IBAN, an international standard (ISO 13616) for identifying bank accounts across borders and will be implemented in two phases.
In the first phase, all banks shall generate and notify IBAN to all their customers by December 2012. In the second phase, IBAN account numbers will be operationally used (capturing, recognition, processing, validation, transfer) both for domestic as well as for international financial transactions by June, 2013.
With the implementation of IBAN, a bank account standard across Pakistan will bring more efficiency in payment processing by enabling the payments/clearing systems to electronically validate account numbers and to decide the route a payment should take without manual intervention.
This will eliminate delays in credit transfers originating from IBAN compliant countries to Pakistan. IBAN implementation will also help in bringing more efficiency in remittance related transactions as a significant percentage of these transactions are rejected due to inaccurate account numbers information. Account validation at remitting institution due to IBAN's check digit mechanism will significantly reduce errors related to account numbers.