The federal government has revised the process for pension payments by removing the administrative role of commercial banks in the biometric verification and validation of pensioners’ proof-of-life certificates. The Ministry of Finance has issued revised standard operating procedures on the directives of Prime Minister Shehbaz Sharif, introducing a digital mechanism intended to make pension verification and disbursement more convenient for pensioners. Under the revised procedures, commercial banks will primarily serve as pension disbursement agencies, while verification of pensioners’ life status will be handled through a digital connection between the National Database and Registration Authority (NADRA), the Controller General of Accounts (CGA) and the Military Accountant General (MAG).
The new system establishes a secure application programming interface (API) between NADRA and CGA/MAG, allowing the Digital Life Signal to be transmitted directly between the relevant government institutions without passing through commercial banking channels. According to the revised notification, commercial banks will no longer have a statutory or administrative responsibility for verifying, collecting, retaining or validating proof-of-life certificates or biometric data in their ordinary banking capacity. The only exception will apply when a bank acts as an authorised operational conduit through NADRA’s designated system for generating proof-of-life certificates. The change is aimed at reducing the administrative burden on pensioners and separating pension verification from the ordinary banking process.
The government has also directed that pensioners’ bank accounts will not be subjected to standard dormancy requirements for the purpose of processing or disbursing pension payments. The revised procedures formally state that standard bank dormancy requirements will not apply to pension accounts under the Federal Government Receipt and Payment Rules, 2025. Banks will also not be permitted to impose debit restrictions because a pensioner has not submitted proof of life to the bank. Accounts that were marked dormant before August 22, 2026, are required to be reactivated either following NADRA verification through an authorised branch conduit or after confirmation of pension receipt from CGA/MAG from September 2026 onwards.
The revised framework also eliminates the physical “Disburser’s Half” process, which previously involved paper documentation for pension payments. Federal pensions will now be disbursed exclusively through the Direct Credit System (DCS), while pension rolls will be generated by the 24th and verified by the 26th of each month for execution through the State Bank of Pakistan’s RAAST system or other micropayment channels. The process will also be subject to quarterly audits and reconciliation of NADRA logs. Accounts offices and banks will conduct quarterly reconciliations using API logs and digital ledgers, with discrepancies required to be resolved within six weeks.
Under the new mechanism, pensioners will be able to complete proof-of-life verification through the NADRA PakID mobile application or authorised NADRA channels. These include NADRA Registration Centers, Mobile Units, e-Sahulat franchises and bank branches that are operating strictly as designated NADRA proof-of-life verification centres. Pensioners are required to complete verification at least once every six months, or within 180 days. This replaces the previous arrangement under which verification was tied to fixed periods in March and September. Pensioners can now complete the verification at any point within the 180-day interval, providing greater flexibility in meeting the requirement.
The revised procedures also establish specific arrangements for family pensioners and pensioners who cannot use digital channels. Family pensioners drawing pensions subject to marital status conditions will be required to submit Form-12 declarations where applicable. Pensioners who are unable to use the PakID application because of limited digital access, advanced age or debilitating medical conditions can visit designated District Accounts Offices or Pension Facilitation Centres operating under CGA/MAG. These facilities will also be available in family pension cases where real-time information concerning remarriage or marital status has not been updated in NADRA records. Such pensioners may submit a manual life certificate through Form 10 or the relevant Form 12 declaration, after which authorised personnel will upload the documentation into the centralised system.
Commercial banks have been specifically prohibited from accepting or processing Form 10 or Form 12 directly in these circumstances. If a pensioner approaches a bank branch with paper documentation, the bank must direct the individual to the NADRA PakID application or an authorised NADRA registration centre instead of collecting, retaining or processing the documents. Banks have also been instructed to open pension accounts only in the name of the pensioner or eligible family pensioner, with joint pension accounts prohibited under the revised procedures. Account transfers are required to be routed through the target scheduled bank, while overpayments or discrepancies must be reported directly to the relevant accounts office and the bank.
The SOPs also clarify the treatment of dormant and suspense accounts. Pensioners with dormant accounts can activate them either through NADRA biometric verification conducted at designated bank branches serving as authorised proof-of-life centres or through the receipt of pension credits from CGA/MAG beginning in September 2026. Where an account has been placed in suspense status by CGA/MAG and funds remain uncollected, the bank will remit those funds to the government after receiving formal notification from CGA. Banks will not independently suspend or close pension accounts under the revised framework.
The revised SOPs were prepared following consultation among relevant stakeholders, including the State Bank of Pakistan, Accountant General Offices, NADRA and the Ministry of Finance. The new framework is intended to strengthen the verification process through direct digital data exchange while reducing unnecessary branch visits and paperwork for pensioners. By shifting proof-of-life verification to a centralised digital system and limiting banks primarily to pension disbursement functions, the government is restructuring the pension payment process around digital verification and direct credit mechanisms while maintaining alternative manual channels for pensioners who cannot access digital services.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.