Bank Alfalah Imposes 5% Monthly Fee on High Value Accounts

Bank Alfalah Limited has imposed a 5 percent monthly fee on all checking accounts with month’s last day balances of Rs. 5 billion and above (or equivalent in case of FCY).

The change has been updated in the bank’s existing schedule of charges for the period July-December 2024. The charges are applicable from Dec 15th. Hence, there shall be no deduction for November’s month-end balance.

It is common practice for banks to regularly update and amend the Schedule of Charges in line with market conditions and dynamics. The SoC is reviewed periodically and updated accordingly.

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However, a 5 percent monthly fee essentially means that the bank will deduct a minimum sum of Rs. 250 million per month from big-value accounts with a minimum deposit of Rs. 5 billion.

This is in response to the federal government’s hefty 16 percent tax on banks with an Advance-to-Deposit Ratio of less than 50 percent. Banks are looking to avoid paying the big ADR tax and could go to any legal lengths seeking cover.

Authorities have focused on banks to increase private lending and set a big price to pay in case they fail to achieve the intended target.