• Senate panel probes Rs26bn overcharging claims
• PBA chief says 88pc hike in rates, telcos deny allegations

ISLAMABAD: Telecommunication companies (telcos) and banks had a face-off on Wednesday before a Senate panel investigating complaints of banks overcharging their customers through regulatory or unauthorised messaging services.

Both the banks and telcos pass the blame to each other for charging an extra fee to bank customers worth Rs26 billion. This prompted the Senate Standing Committee on Finance, chaired by Saleem Mandviwalla, to investigate the issue thoroughly and request both sides as well as the State Bank of Pakistan (SBP) to provide their transaction details along with the rates of service charges.

The meeting also decided to invite the Pakistan Telecommunication Authority (PTA) for assistance. Some senators believed that banks should not charge a separate SMS fee and that it should be included in their services or be rationalised.

At the outset, Pakistan Banks Association (PBA) President Zafar Masud reported that there were two types of SMS charges — mandatory regulatory requirements of the SBP and transaction-related messages to customers, none of which were discretionary.

Assisted by the presidents of Habib Bank, MCB Bank, and Meezan Bank, Mr Masud said the banks charged only for transaction-related messages, with the customers’ upfront consent, in the interest of their security and to avoid fraud and unauthorised transactions in their accounts. Also, the schedules of charges are declared regularly by the banks.

He said the SMS charges to customers did not meet the cost of the SMS service. The banks paid about Rs25.6bn to the telecom companies while they recovered only Rs18.7bn from customers, leaving around Rs7bn losses. He said the telcos rates charged to banks had gone up by 88pc since 2021. Also, 88pc customers were now using digital accounts and mobile apps that no longer required SMS.

The PBA chief said that telcos charged around 60 paise per SMS to their own customers for similar messages but around Rs2.6 to Rs3.4 per message to banks, despite being bulk and corporate clients, which was unreasonable.

SBP’s Deputy Governor Dr Inayat Hussain said some regulatory SMS were mandatory and should be free of cost under SBP rules. He, however, opposed seeking details from banks about SMS related financials, saying it would be very difficult.

Muddassir Husain of Jazz’s regulatory affairs, who led the Telcos’ delegation, said SMS was a key part of their business but pointed out that banks seldom send 2-3 messages to customers per day, which means no more than Rs300 per month per customer at most. However, the banks were charging more than Rs400 to their customers. He said telcos also applied similar rates to BISP.

Senator Anusha Rehman said the actual cost of an SMS was one-two paise and telcos even offered 300-500 free SMSs to their customers per month. However, charging Rs2.5-3.5 per message meant the banks or telcos or both charged a big arbitrage to customers, which should be investigated and rationalised.

During the debate, it was revealed that the banks and telcos did not have direct settlement arrangements but operated through third parties called aggregators, who take messages from banks or telcos and then send them to customers. The panel decided to discuss the matter again at its next meeting, based on details received from both sides.

Honorarium/salary hikes

The committee further discussed the issue of non-payment of the budget honorarium announced by the finance minister to the medical and PTV staff deputed at Parliament House during the budget session. The chairman committee directed that the matter be immediately referred to the finance minister for approval and payment of honorarium; otherwise, the committee would take stern action against non-compliance.

The matter of salary increments for university faculty members and professors under the Tenure Track System (TTS) was also taken up. The committee was informed that university staff had been denied annual salary increases for the past 10 years. The panel termed this situation a clear injustice to the staff.

Minister of State for Finance and Revenue Bilal Azhar Kayani assured that the matter would be taken up with the relevant authorities and a report would be submitted within 15 days.

The meeting also took up the matter raised by the Sarhad Chamber of Commerce and Industry regarding the classification of polyurethane (PU) leather. Pakistan Customs briefed the Committee that PU material fell under the category of textiles rather than leather, as it contained fabric backing on one side and the importer was liable to pay the taxes as per the prescribed category. The representatives of the chamber stated that it was a type of leather, not fabric, and should be treated as such under the relevant law governing the import of leather.

The Federal Board of Revenue chairman advised the affected parties to file an appeal with the member policy for further consideration and direction.

Published in Dawn, April 2nd, 2026