ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has approved a comprehensive Strategic Action Plan 2024-2026 to advance Islamic finance in non-banking sectors, aligning with the 26th Constitutional Amendment that mandates the elimination of Riba by January 1, 2028.
Objectives and Implementation
The plan sets a clear roadmap for enabling Islamic finance across all SECP-regulated sectors by December 2026. A detailed strategy will be developed to guide the smooth transition of conventional financial institutions into fully Islamic financial entities, ensuring minimal disruption to the financial ecosystem.
Key Focus Areas
The strategy revolves around four main verticals:
- Growth Acceleration: Increasing Islamic finance’s share within regulated sectors.
- Standardization: Promoting consistency and harmony in Islamic financial practices.
- Quality Improvement: Enhancing the performance and efficiency of Islamic financial institutions.
- Strengthened Legal Framework: Establishing a robust legal foundation for Islamic finance to thrive.
These pillars aim to facilitate the growth of Islamic financial institutions, assets, and services, particularly in the non-bank financial sectors.
Collaboration and Support
The SECP has collaborated with Capital Market Infrastructure Institutions (CMIIs) to design and validate the plan. It intends to leverage CMII expertise to build a supportive regulatory environment that fosters the growth of Islamic finance.
Commitment to Constitutional Mandates
The SECP reaffirmed its dedication to advancing Islamic finance in alignment with Pakistan’s constitutional and legal obligations. The initiative underscores its commitment to creating a resilient, inclusive financial ecosystem that adheres to Islamic principles.
This strategic plan represents a significant step toward transitioning Pakistan’s financial landscape to align with Islamic values while maintaining economic stability.
