Our source has obtained a circular issued by the Central Bank of Libya to commercial banks regarding regulations for setting purchase limits based on individual salaries. The goal is to facilitate salary disbursement before funds are deposited into banks and to promote electronic payments.
The regulations stipulate that banks must establish purchase limits through electronic payment services they offer, such as electronic cards or mobile applications.
The limit granted to customers is considered a form of Qard Hasan (interest-free loan) and is subject to all its rules, terms, and Sharia-compliant regulations. Key conditions include:
- No commissions, whether fixed or percentage-based, are to be charged on the overdraft amount.
- Customers must not be required to subscribe to additional services to receive the limit.
The service is to be offered upon customer request through bank-specific mobile applications, SMS services, or signed forms that outline all product terms and conditions, approved by the bank’s Sharia supervisory board.
Each bank is required to establish policies and regulations for the service, including identifying target beneficiaries, service terms, and the procedures needed to safeguard the rights of both the bank and its customers. Banks may impose conditions for eligibility, restrict usage cases, set specific loan ceilings, or link the limit to the salary value, provided these conditions do not conflict with the bank’s financial policies or legal regulations.
The service is available to bank customers with active current accounts who have been receiving regular salary deposits for at least six months.
The granted limit must not exceed 60% of the net salary after deducting any installments or obligations. The used amount is automatically deducted from the limit when the salary is deposited, and the limit is renewed automatically unless either party decides otherwise.
The bank’s board of directors and Sharia supervisory board must approve the policies, product guidelines, terms, and models, ensuring compliance with regulations issued by the Central Bank of Libya.
Banks are also authorized to take all necessary technical and legal measures to recover their dues in cases where customers fail to prove insolvency. Additionally, banks may refuse to provide a Qard Hasan to clients with a history of defaults or other issues, as determined by approved policies and regulations to mitigate risks.
In light of this, the Central Bank has urged commercial banks to launch the product and prepare their systems to enable the use of these limits for electronic payment transactions in compliance with the aforementioned terms and regulations.
