Asian banks, including those in Pakistan, must balance financial inclusion goals, consumer empowerment and financial literacy initiatives, according to the latest scorecard issued by Fair Finance Asia (FFA).
Titled scorecard Empowering consumers as drivers of sustainability in the financial sector in Asiameasures the policies of 15 banks across Pakistan, Cambodia, Indonesia, the Philippines, and Thailand in four key areas: financial inclusion, consumer protection, financial literacy, and engagement mechanisms.
In Pakistan, United Bank Limited (UBL), MCB Bank and National Bank of Pakistan (NBP) showed relatively strong performance in financial inclusion (6.7/10) and consumer protection (6.9/10).
However, they scored poorly in financial literacy (3.3/10) and engagement mechanisms (1.2/10), reflecting significant gaps in these areas.
The scorecard indicates that although these banks offer products targeting unbanked or underbanked populations, they fail to disclose measurable targets for financial inclusion.
In addition, none of the banks evaluated deployed measures to prevent over-indebtedness or provided mechanisms for consumers to file complaints about the environmental, social and governance impacts of the projects financed.
The report also highlighted the lack of transparency regarding companies and projects financed by UBL Bank, MCB Bank and NBP Bank. Banks were criticized for not clarifying how sales staff or agents proactively communicate with consumers about sustainable finance products, indicating a disconnect between financial institutions and stakeholders.
“Banks in Pakistan appear to be prioritizing profit over purpose, and promoting financial products without fully considering their impact on individuals and society,” said Asim Jafri, Head of Fair Finance Country Program in Pakistan.
He urged banks to take stronger measures to empower consumers and protect environmental and social well-being.