Regulatory Alerts2020-01-01
Instructions No. 23 of 2020 on Deferral of Monthly/Periodic Installments During the Health Crisis
The Palestine Monetary Authority issued Instructions No. 23 of 2020 to mandate that banks offer customers two options for repaying installments deferred during the health crisis: early repayment without fees or spreading the deferred amount over the remaining loan term. Islamic banks are specifically required to allow customers until December 31, 2021, to settle these deferred amounts unless otherwise agreed. All relevant authorities must enforce these provisions immediately upon issuance to ensure consistent implementation across the financial sector.
Palestine Monetary Authority
PALESTINE MONETARY AUTHORITY
Instructions No. (23) of 2020
Regarding the Deferral of Monthly/Periodic Installments During the Health Crisis Period
Based on the provisions of Decision-Law No. (9) of 2010 regarding Banks, particularly Articles (2), (21), (40), and (72) thereof,
and after reviewing Instructions No. (4) of 2020 regarding the Palestine Monetary Authority's procedures to mitigate the impacts of the health crisis,
and Instructions No. (2) of 2016 regarding Responsible Borrowing,
and in pursuit of the public interest,
we have issued the following Instructions:
Article (1)
Repayment of Deferred Installments
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The bank must provide its customers with the option to choose either of the following:
a. Early repayment of installments deferred during the health crisis at any time without charging an early repayment fee.
b. Spreading the value of deferred installments over the loan term, except as stated in Article (6), paragraph (5.2) of Instructions No. (2) of 2016 regarding Responsible Borrowing for individual customers. -
The Islamic bank must grant its customers until 2021/12/31 to settle the value of deferred installments, unless the two parties agree otherwise.
Article (2)
Implementation and Enforcement
All competent authorities must implement the provisions of these Instructions within their respective jurisdictions, and they shall apply from the date of their issuance.
Issued in Ramallah on 2020/06/30 AD
Financial Stability Group
Palestine Monetary Authority
Ramallah & Al-Bireh Governorate - Palestine P.O. Box 452
Ramallah & Al-Bireh Governorate - Palestine P.O. Box
info@pma.ps | Fax: +970 2 2415310 | Fax | Tel: +970 2 2415251 | Tel
Gaza - Palestine P.O. Box 4026
Gaza - Palestine P.O. Box
Fax: +970 8 2844487: Fax | Tel: +970 8 2825713: Tel