Regulatory Alerts2023-01-01
Instructions No. 14 of 2023 Regarding Granting Public Sector Employees Salary Advances
The Palestine Monetary Authority issued Instructions No. 14 of 2023 to regulate the procedures for granting temporary salary advances to public sector employees by licensed banks. The regulations mandate that advances be limited to 50% of the salary, with the Ministry of Finance bearing the interest costs capped at 3% per annum, and require repayment upon salary transfer. These instructions apply to all licensed banks in Palestine and entered into force on November 27, 2023.
[Logo of the Palestine Monetary Authority]
Palestine Monetary Authority PALESTINE MONETARY AUTHORITY
Instructions No. (14) of the Year 2023 Regarding Granting Public Sector Employees Salary Advances
Based on the provisions of the Decree-Law (9) of the Year 2010 concerning Banks, particularly Articles (40, 72) thereof, And in accordance with the powers delegated to us, And to achieve the public interest, We have issued the following Instructions:
Article (1) Objective and Scope of Application
- These Instructions aim to regulate the procedures for granting temporary advances to public sector employees.
- The provisions of these Instructions apply to all banks licensed by the Palestine Monetary Authority to conduct banking business in Palestine.
Article (2) Public Sector Employee Advances
The bank must comply with the following:
- Disburse advances to public sector employees at a rate of 50% of the salary according to the statements of the Ministry of Finance and the Pension Authority.
- The minimum advance amount for a non-borrowing employee, or the net salary received by the employee last month for a borrowing employee, must not be less than a specified threshold (Note: Original text implies a minimum floor but does not specify the amount in the provided snippet, preserving the structure).
- The advance is used to settle any advances the employee obtained after the date 2023/11/1, provided that deductions do not exceed 50% of the advance.
- The maximum permissible interest or return to be collected is 3% reducing, calculated on a daily basis.
- The Ministry of Finance bears the interest or return on the temporary advance for the public sector employee.
- The advance is repaid upon the transfer of the salary.
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[Logo of the Palestine Monetary Authority]
Palestine Monetary Authority PALESTINE MONETARY AUTHORITY
Article (3) Entry into Force
All competent authorities must implement the provisions of these Instructions, each within its respective domain, and they apply from the date of their issuance.
Issued in Ramallah, on the date: 2023/11/27 AD
Dr. Firas Malham Governor [Signature]
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