PMA Instructions No. 14 of 2023 on Salary Advance Loans for Public Sector Employees

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Palestine Monetary Authority
PALESTINE MONETARY AUTHORITY

Instructions No. (14) of 2023
Regarding the Granting of Salary Advance Loans to Public Sector Employees

Based on the provisions of Law Decree No. (9) of 2010 concerning Banks, particularly Articles (40 and 72) thereof, and in accordance with the powers delegated to us, and in pursuit of the public interest, we have issued the following instructions:

Article (1)
Objective and Scope of Application

1. These instructions aim to regulate the procedures for granting temporary loans to public sector employees.
2. 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 Salary Advance Loans

The bank shall comply with the following:

1. Disburse a loan to public sector employees at a rate of 50% of the salary, according to the statements of the Ministry of Finance and the Pensions Authority.
2. The minimum loan for a non-borrowing employee, or the net salary received by a borrowing employee in the previous month, shall not be less than the applicable threshold.
3. The loan shall be used to settle any loans the employee obtained after 2023/11/1, provided that deductions do not exceed 50% of the loan.
4. The maximum allowable interest or return to be charged shall be 3% reducing, calculated on a daily basis.
5. The Ministry of Finance shall bear the interest or return on the temporary loan for public sector employees.
6. The loan shall be repaid upon salary transfer.

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Palestine Monetary Authority
PALESTINE MONETARY AUTHORITY

Article (3)
Entry into Force

All competent authorities shall, each within its respective jurisdiction, implement the provisions of these instructions, which shall apply as of their date of issuance.

Issued in Ramallah, on: 2023/11/27

Dr. Firas Melhem
Governor
[Signature]

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