JS Bank to establish an Islamic Banking window
JS Bank Limited (JSBL) has unveiled plans to establish an Islamic banking
window as part of Pakistan’s transition to a fully Sharia-compliant financial
system by January 2028, in line with the State Bank of Pakistan’s (SBP) Vision
2028.
The bank’s Chief Operating Officer (COO), Atif Salim Malik, revealed that a
formal proposal has been submitted to the SBP for approval.
“We’re committed to a phased shift towards Islamic banking, reflecting
government mandates under the 26th constitutional amendment aimed at
eliminating interest-based banking,” Malik explained.
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JSBL’s acquisition of BankIslami in 2023 bolstered its Islamic finance
capabilities, expanding its combined network to over 800 branches. Malik
acknowledged challenges, particularly in reconciling international creditor
expectations with Islamic financial principles, but expressed confidence in the
bank’s readiness for the transition.
Empowering SMEs and Agriculture
JSBL has prioritized lending to small and medium enterprises (SMEs) and agriculture,
dedicating 17% of its portfolio to these sectors—well above the industry
average of 4%. The bank has taken innovative steps to address financing gaps,
including a Pakistan Banks’ Association survey designed to incorporate
undocumented businesses into the financial ecosystem.
Promoting Renewable Energy
In line with its sustainability goals, JSBL has joined the Green Climate Fund
to support solar energy initiatives, signaling its commitment to renewable
energy financing.
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Digital Banking Transformation
JSBL’s digital banking brand, “Zindigi,” has achieved significant milestones,
attracting over five million accounts within just 2.5 years. More than 80% of
its customers engage with digital platforms such as WhatsApp banking and
internet services.
Navigating Economic Challenges
Malik anticipates that declining interest rates will stimulate consumer
financing for auto and housing loans but may slow deposit growth. Additionally,
recent tax hikes, including the increase in the standard income tax rate for banks
to 44%, present further challenges.
With a strategic focus on Islamic banking, SME lending, and digital
innovation, JSBL is positioning itself as a key player in Pakistan’s evolving
financial landscape.
Source: Profit Pakistan