Pakistan to launch shariah-compliant products worth $178.6 million
Pakistan’s State Minister for Finance,
Ali Pervaiz Malik, announced on Tuesday that the government will introduce new
Shariah-compliant certificates valued at $178.6 million this month. These
certificates aim to support lending activities within an interest-free
framework, according to state-run media reports.
A Shariah-compliant certificate
verifies that a financial product or transaction adheres to Islamic principles
and laws. This initiative follows the Securities and Exchange Commission of
Pakistan’s (SECP) issuance of the first Shariah-compliant certificate for real
estate investment trusts last year, and the licensing of the country’s first
Shariah-compliant brokerage house in April.
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In his address to the National
Assembly, Malik emphasized the government's dedication to advancing Islamic
banking in Pakistan. “We are committed to promoting Islamic banking, and the
introduction of these new certificates underscores that commitment,” Radio
Pakistan reported.
This announcement coincides with
Pak-Qatar Family Takaful Limited’s launch of an instant withdrawal feature for
its customers. This service allows participants to access partial funds during
emergencies via the company’s mobile app or online portal.
Pakistan’s central bank has set an
ambitious target to increase the Islamic banking sector’s share to 35% by 2025.
Currently, Islamic banking holds a 20% share of the total commercial banking
system. The Federal Shariat Court has mandated the elimination of interest from
the banking system by 2027.
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Over the past five years, Islamic
banks in Pakistan have experienced significant growth, with their assets and
deposits increasing annually by 25% and 22%, respectively, according to central
bank data.
Source: Arab News