Connect with us

Hi, what are you looking for?

Latest News
• Bollywood actor Akshay Kumar tests negative for covid • Covid threat: IHC suspends routine work till May 16 • Human rights protagonist and journalist I. A. Rehman passes away at age 90 • Daska by-poll win testifies public support for Nawaz Sharif: Shahbaz Sharif • PTI blames RO for Daska defeat • GB politician Yahya Shah dies at 93 • PM to address the Special High-Level Segment of ECOSOC Forum on Financing for Development • CM Punjab launches food distribution scheme in Lahore, Faisalabad • 100 new ventilators being acquired to ease burden in Punjab: Dr Yasmin Rashid • Over 1,100 Sikh pilgrims issued visas to attend Vaisakhi festival • pilgrims will enter Pakistan on foot via the Wagah border • CDA misstated illegal construction of courts in F-8: IHC registrar • Benny Mario Travas appointed as new Bishop of Karachi • Sindh police initiative to build database of workers getting popular • International Civil Aviation Organisation audit team postpones its visit to Pakistan owing to Covid surge • Robbers break open over 30 lockers in Sakhi Hasan bank heist • IMF wants parliament to approve laws under deadlines • Fafen terms Daska by-poll generally transparent • FM Qureshi arrives in Berlin on two-day official visit • Bilawal tears up PDM’s show-cause notice • Swiss cases to be reopened: Sheikh Rashid • PM Khan approves plan to form south Punjab as separate zone • 5 Kashmiri fighters killed, 2 Indian soldiers injured in Indian occupied Kashmir • PSL 6 matches set to resume on June 1: PCB • Russia, China frustrating world response to Myanmar crisis: EU • Kyrgyzstan referendum shows support for presidential rule • Iran reports blackout at Natanz atomic site, terms it ‘nuclear terrorism’
News Alert
    • UK reopens pub gardens, salons, gyms, and non-essential shops  
    • Punjab govt. mulls over imposing complete lockdown in Lahore
    • Covid Updates: 4,584 cases reported while 58 deaths recorded in last 24 hrs
    • Currently, 75,266 cases are active in the country
    • The death toll reaches 15,501 in Pakistan
    • 1,772 people recovered in last 24 hrs
    • The current positivity rate is 11% in the country 


Riba Is War with Allah, not with State Bank; In 5-year Islamic Banking Be 1/3rd of Entire banking

The State Bank of Pakistan (SBP) noted that Shariah-compliant banking had gradually become an important part of the domestic economy with its market share increasing close to one-fifth of the overall banking industry in terms of deposits and assets over the past two decades.

islamic banking sharia islam economy finance money management transaction concept

KARACHI: Pakistan’s central bank has launched a third five-year plan (2021-25) to support Islamic banks in expanding their outreach nationwide, advising them to increase online banking and “capitalize on fintech to sustain the growth momentum.”

The State Bank of Pakistan (SBP) noted that Shariah-compliant banking had gradually become an important part of the domestic economy with its market share increasing close to one-fifth of the overall banking industry in terms of deposits and assets over the past two decades.

Still, there is enormous potential for the industry to grow fast considering that the Muslim community dominates the population landscape in the country. Increased awareness of Islamic banking may help it achieve the next level of growth.

In a statement issued on Monday, the central bank highlighted that the State Bank aimed to make Islamic banking one-third of the overall banking industry by 2025.

“For more penetration in the market and minimising services delivery costs, IBIs (Islamic banking institutions) need to increase the use of alternative delivery channels,” it said.

“Given the significant contribution of branchless banking towards improving financial inclusion, there is a need for the Islamic banking industry to capitalise on fintech to sustain its growth momentum.”

“This plan gives headline targets in terms of increasing share in both assets and deposits of the Islamic banking industry to 30% of the overall banking industry, 35% share in branch network of the overall banking industry, 10% and 8% share in SME (small and medium-sized enterprise) financing and agriculture financing respectively in private sector financing of the Islamic banking industry (by 2025),” according to the SBP’s Strategic Plan for Islamic Banking Industry 2021-25.

The Islamic banking industry has now become a systemically important component of the banking industry with a remarkable growth over the last two decades. However, the share of the industry remains low considering its huge potential in a country like Pakistan with a majority of Muslim population.

“The network of the Islamic banking industry is concentrated in urban areas, though it has improved its coverage in recent years; however, the industry still requires expanding its outreach to unserved/underserved sectors and regions.”

“Like globally, the domestic Islamic banking industry is faced with the liquidity management challenge (like they have liquidity but lack avenues to invest and finance),” the central bank said, adding that it would amend some related laws and “coordinate with Islamic banking institutions for developing Shariah-compliant structures/solutions for liquidity management as and when desired.”

To help Islamic banks grow in Pakistan, the latest five-year plan suggests that the central bank would extensively work in six areas including strengthening legal landscape, enhancing conduciveness of regulatory framework, reinforcing comprehensive Shariah governance framework, improving liquidity management framework, expanding outreach and market development, and bolstering human capital and raising awareness.

The plan suggests that the central bank will amend several laws in these six areas.

The Islamic banking industry has widened its footprint in the banking network of the country.

Currently, 22 Islamic banking institutions (five full-fledged Islamic banks and 17 conventional banks having standalone Islamic banking branches) are offering Shariah-compliant products and services through a network of 3,456 branches and 1,638 Islamic banking windows (dedicated counters at conventional branches) spread across 124 districts of the country.

The Islamic banking industry has acquired a market share of 17% and 18.3% in assets and deposits respectively of the overall banking industry by the end of December 2020.

Written By

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *




Region-Israel relation normalization depends on the Israel-Palestine peace process, sys Saudi FM.

Latest Updates

Federal Minister for Science and Technology Fawad Chaudhry made the announcement of moon sighting evening to be April 13 and said that first Roza...


$42k fine imposed by Russian Court after a hearing that was seen on video by Social Media Top officials.

Social Issues

Pakistan open up its National Security discourse to allow participation by a wider swathe of the country’s intelligentsia.

Copyright © 2021 The Truth International