SBP Orders TAG to Refund Outstanding Funds to Customers Over Regulatory Violations

The State Bank of Pakistan (SBP) on August 04, 2022 has advised M/s TAG Innovation Pvt. Ltd. to refund all outstanding funds to its customers immediately.

This action has been taken after identification of violations of SBP’s regulatory requirements and other concerns during the pilot operations of M/s TAG.

Fintech startup TAG, currently in pilot stage of Electronic Money Institution (EMI) licensing process, has been given until August 19 by the State Bank of Pakistan (SBP) to make all the refunds.

The SBP clarified that Electronic Money Institutions (EMIs) licenses are issued by SBP to non-bank entities in three stages i.e. In-Principle Approval, Pilot Operations Approval and Commercial Operations Approval.

Moreover, pilot operation is conducted to assess the readiness of the business for commercial operations and only after its successful completion, license to commence commercial operations is granted to the respective EMI.

It is pertinent to mention that there has been a recent influx of several different EMIs in the country like NayaPay and SadaPay, both of which have been commercial licenses by the SBP.