Key Takeaways
- The Senate Standing Committee on Finance and Revenue approved the 'Netting of Financial Arrangements Bill, 2026'.
- The bill aims to strengthen Pakistan’s financial sector by providing legal certainty in case of termination events.
- The government is also digitizing BISP payments to enhance transparency and service delivery.
The Senate Standing Committee on Finance and Revenue has approved the 'Netting of Financial Arrangements Bill, 2026', a move aimed at enhancing Pakistan’s financial markets. The bill seeks to remove legal uncertainties surrounding the settlement of financial contracts during bankruptcy or insolvency events, thereby paving the way for more sophisticated financial products.
During the meeting on Thursday, chaired by Saleem Mandviwalla, representatives from the Pakistan Banks Association informed the committee that netting laws are widely recognized internationally and facilitate financial transactions. They highlighted that the proposed legislation had been developed through extensive consultations with the banking sector and the State Bank of Pakistan, ensuring alignment with global practices.
Minister for Finance and Revenue Senator Muhammad Aurangzeb emphasized the importance of this bill in strengthening Pakistan’s financial sector. He stated that the government has undertaken extensive consultations during the drafting process to ensure all relevant stakeholders were involved. The approved legislation will allow financial collateral arrangements under netting rights, thereby limiting the powers of liquidators to prevent cherry-picking and ensuring a fair settlement.
In related news, Senator Aurangzeb also informed the committee about efforts to digitize Benazir Income Support Programme (BISP) payments as part of a broader digital transformation initiative. He stated that financial assistance to beneficiaries would be disbursed through digital wallets, enhancing transparency and efficiency in service delivery.
The Minister further noted that the government is promoting the use of technology across public sector institutions, including BISP, to strengthen digital payment mechanisms. He referred to an incident during the disbursement of BISP payments last year, underscoring the importance of robust digital infrastructure.
Senator Muhammad Talha Mahmood supported the Minister’s position, observing that public sector employment has increasingly become a sought-after opportunity. He highlighted the need for continued digitization and technological advancements in government services to meet growing demands.
Chairperson BISP Senator Rubina Khalid informed the committee that while digital payments are being made through banking channels, the Programme requires dedicated operational staff to effectively manage its expanding responsibilities. She expressed concern over suggestions that BISP does not require additional employees, emphasizing the operational needs of the Programme.
