The State Bank of Pakistan (SBP) has directed all commercial banks and microfinance banks to refrain from imposing debit blocks, operational restrictions, or freezing customer accounts without proper legal authority, reinforcing safeguards for account holders following directives issued by the Islamabad High Court (IHC).

In a circular issued on June 15, 2026, the central bank instructed chief compliance officers of all banks to ensure that any restriction on a customer's account is implemented strictly in accordance with applicable laws, supported by the necessary legal authorization, and carried out only after completing due verification procedures.

The directive follows an Islamabad High Court order issued on June 2, 2026, which prohibited banks from freezing or restricting customer accounts unless expressly permitted under the law.

To strengthen regulatory compliance, the SBP has instructed banks to establish robust internal control mechanisms to prevent precautionary or inadvertent account restrictions that lack legal backing and could unnecessarily inconvenience customers.

The central bank emphasized that any action affecting access to a customer's bank account must be based on lawful authority and appropriate verification before implementation.

Banks have also been directed to formally acknowledge receipt of the SBP's instructions before the Islamabad High Court and confirm compliance with the central bank through official communication.

According to the court proceedings, Justice Arbab Muhammad Tahir ruled that customer accounts cannot be frozen or subjected to debit restrictions without approval from the competent authority or other lawful authorization. The court also instructed the SBP to develop an internal compliance framework and issue clear regulatory guidance to ensure banks fully adhere to the order.

The SBP has since submitted its compliance report to the Islamabad High Court, confirming that fresh nationwide instructions have been issued to strengthen compliance, protect customer rights, and ensure that banking restrictions are imposed only where legally justified.