Practice and Procedure for Recovery in Pakistan's Banking Law

No modern economy can run without loans and credit, and the main channels of macro financing in nowadays market are banks and other cognate financial institutions. Lending money becomes a risky enterprise if, in case of debtor default, there is no speedy and trustworthy system in place to ensure recovery of the loan and lack of trust in the recovery system can have paralysing effects on the economy. The legislators in Pakistan have shown keen awareness of this since the late 1970’s, when specific norms were introduced to make available fast track recovery avenues to creditors. This article analyses the latest legislative developments in the field, in the light of all relevant case law. It expounds present provisions regulating the creation and jurisdiction of banking courts, the filing and defending of cases and appeals before them and enforcement of their decisions. Finally, the paper ends with an appraisal of existing Pakistan’s recovery laws and some suggestions for their effective implementation.

Ali Raza Kabir, holds an LLB from the University of Punjab and an LLM in International Commercial Law from the University of Salford (UK).
He is currently practicing as partner in Ali & Qazi (Advocates & Advisors), a corporate law firm based in Lahore.