Karachi: The National Clearing Company of Pakistan Limited (NCCPL) has approved amendments to its regulations, enabling digital banks and exchange-traded funds (ETFs) to gain admission as clearing members and settling banks. The decision, outlined in a report dated September 25, 2026, introduces changes to the NCCPL Regulations, 2015, facilitating broader participation from emerging financial institutions.

The amendments redefine the role of a designated branch within a settling bank. Previously restricted to branches acceptable to the company for money settlement services, the new provision allows digital banks to be recognized as designated branches themselves. This change is expected to streamline operations for clearing members entering into tripartite agreements with settling banks.

Further alterations expand the eligibility for clearing membership under the National Clearing and Settlement System (NCSS). The updated regulations now include digital banks within the definition of banking companies, contingent upon meeting a minimum short-term credit rating of A3. This broadens the scope for digital banks seeking integration into the NCSS, thereby enhancing their operational capabilities.

Additionally, the amendments specify that a clearing member may appoint multiple settling banks, entering into agreements with designated branches for money settlement. This flexibility is anticipated to aid financial institutions in diversifying their clearing and settlement operations.

According to information available from the Pakistan Stock Exchange (PSX), the changes also impact investment companies, asset management companies, and insurance firms seeking to become clearing members. These entities must comply with specified credit ratings, such as an AM3 asset manager rating for asset management companies and an A+ long-term rating for insurance companies. The modifications further accommodate newly established banking companies and collective investment schemes by offering conditional compliance periods for rating requirements.

The NCCPL’s decision reflects a strategic move to integrate digital banking entities and ETFs into the clearing and settlement framework, potentially fostering innovation and competition within the financial sector. These regulatory changes are set to reshape the landscape for clearing members, providing new opportunities for both established and emerging market participants.