Palestine Monetary Authority Issues Circular Note to Banks and Lending Institutions Concerning Deductions of February 2019 Loan Payments from Civil Servants’ Salaries

Ramallah – His Excellency Mr. Azzam Shawwa, the Governor of Palestine Monetary Authority, stated that Palestine Monetary Authority had issued circular note to banks and specialized lending institutions to deduct due payments from the borrowers among civil servant in proportion to the salaries paid into their accounts; however, the deduction must not exceed 50% of the salary. The aforementioned restrictions shall not include the civil servant banks and lending institutions’ borrowers who had borrowed using a source of income other than their salaries. This shall be in accordance with the loan contract signed with the bank or lending institution. The banks shall collect the salary transfer commission once only regardless of the times the salary paid in a month. The circular note is issued in consideration of the circumstances of the civil servants and the difficult economic situation people undergo and to facilitate banking operations concerning civil servants since only part of February 2019 salary will be transferred to some civil servants.

Mr. Shawwa said that Palestine Monetary Authority had asserted in the circular note to banks and lending institutions not to charge interest or late payment fine over postponement of remaining payment and not to charge commission over civil servants’ returned checks throughout the salary payment delay period; however, the total amount of returned checks per civil servant must not exceed the amount of his/her monthly salary.

Mr. Shawwa also said that categorization of civil servants on the returned checks system would stop. The returned check would appear on the client’s report without affecting his/her categorization. The banks and lending institutions shall not disclose the rate of overdue payments resulting from salary payment delays in the overdue payments item of civil servants in the Credit Registry System.