KARACHI: Business leaders and technology experts have urged the banking industry to adopt technological solutions to automate the annual zakat deduction process to continue public dealings at commercial and microfinance bank branches on the first day of Ramazan.
Every year, banks remain closed for public dealing on the first of Ramazan. This allows banks to complete zakat deduction from eligible account holders. However, stakeholders argue that the practice increases the workload of bank staff while denying customers access to essential services. This year too, today (Ramazan 1), banks remain closed for public dealings.
Experts called on banks to consider facilitating customers through dedicated counters — particularly at high-traffic branches in commercial areas, business centres and bazaars — instead of suspending public dealings altogether on what remains a working day for much of the economy.
Dr Noman Said, an IT expert, said advances in financial technology now allow transactional operations, including the calculation and deduction of zakat, to be conducted through automated systems with accuracy and without disrupting branch operations.
“The regulator should introduce a mechanism that ensures zakat deduction without interrupting public dealings at bank branches,” he said, noting that several Muslim-majority countries deduct zakat while maintaining normal banking operations.
The first day of Ramazan has been notified as the ‘Deduction Date’. On this date, zakat will be deducted from savings bank accounts, profit and loss sharing accounts and other similar accounts maintaining a credit balance of Rs503,529 or above.
Under the Zakat and Ushr Ordinance 1980, no deduction at source is made if the balance in an account is below Rs503,529 as of the first day of Ramazan, 1447 A.H. Ibrahim Amin, a financial expert, said most Pakistanis maintain current accounts in commercial banks, while many holders of savings accounts, deposit accounts or mutual funds submit affidavits seeking exemption from zakat deduction.
Despite the growing use of online and mobile banking, customer footfall at urban branches remains significant on working days. Many banks have in recent years opened branches on Saturdays and extended working hours from 5pm to 6pm to facilitate customers, he added.
Expert Malik Jahan Khan, who works in the transportation sector, said automation has transformed most sectors, including banking. “Zakat deduction should be fully automated. There is no operational justification for suspending public dealing on the first day of Ramazan,” he said.
