According to a new scorecard Empowering Consumers as Drivers of Sustainability in Asia’s Financial Sector, which benchmarks the policies of 15 banks across Pakistan, Cambodia, Indonesia, the Philippines, and Thailand it has been found out that Pakistan’s three banks have not performed well in correctly guiding their customers on how to lodge a complaint.
They have also failed to disclose information about their products, says a report published by the Fair Finance Asia (FFA).
The report however shows the Pakistani banks doing much better in other areas such as financial inclusion, financial literacy and education and engagement and accountability mechanisms. The consumer protection is the area where much is need to be done.
In Pakistan, the United Bank Limited (UBL), Muslim Commercial Bank (MCB), and the National Bank of Pakistan (NBP) scored better, on average in financial inclusion (6.7 out of 10), and consumer protection (6.9/10), but scored poorly on financial literacy (3.3/10) and engagement mechanisms (1.2/10).
Launched recently on December 4, International Day of Banks, the new scorecard was developed by FFA in collaboration with national coalitions, Fair Finance Pakistan, Fair Finance Cambodia, ResponsiBank Indonesia, Fair Finance Philippines, and Fair Finance Thailand, and research partner, Profundo.
Financial institutions were assessed based on publicly available information. All three Pakistani banks UBL, MCB, and NBP engaged with FFA during the assessment.
Major findings of the scorecard related to Pakistani banks are that despite UBL, MCB, and NBP offering products targeting unbanked or underbanked populations, the scorecard results show that they fail to publicly disclose measurable targets for financial inclusion.
None of the assessed banks disclose information to prevent over-indebtedness, and neither has the mechanisms for consumers to file complaints related to the environmental, social, and governance (ESG) impacts of financed projects.
In addition, UBL, MCB, and NBP do not disclose information regarding the companies or projects they finance.
