This study advances the argument that institutional Institutions, particularly Consumer Banking can play a vital role in enhancing financial performance in emerging economies like Pakistan. Definitely Monetary Policy has a significant impact on Consumer Banking and any change in monetary policy will affect banking sector in the country. Accordingly, regulatory framework such as Monetary Policy needs to be structured in a manner that would encourage the growth of the Consumer Banking and enable it to play a proactive role in economy of the country. It is true that external financing is utmost important almost for every kind of business in an economy and banking industry is the main facilitator in this regard. Consumer banking system plays its role in the banking industry as banks are the citadels of the economic growth and monetary policy has its significant impact on banking industry specifically here we study its impact on consumer banking. So, studying monetary policy system and its impact on consumer banking in detail will not only benefits the researcher but It will help better understanding of consumer banking, monetary policy and its salient features.