ISLAMABAD – The Securities and Exchange Commission of Pakistan (SECP) has issued a concept note proposing changes in the Non-Banking Financial Companies framework.
According to a press release issued by the SECP on Wednesday, introduction of non-banking microfinance services as a distinct form of business within the NBFC framework will provide clarity.
Placing non-banking microfinance services in separate category will enable the SECP to provide regulations that accommodate the unique needs of microfinance institutions.
This distinction will help streamline compliance processes, reduce regulatory overlap, and enhance the ability of microfinance entities to focus on serving underserved and vulnerable populations effectively.
The overlap amongst investment finance services digital only and microfinance licenses creates ambiguity regarding application of mandatory requirements and operational scope. As digital lending grows, it’s crucial to clearly distinguish microfinance services within the regulatory structure to address the unique needs of the two lending verticals.
SECP has urged stakeholders to provide feedback to refine the proposed amendments, ensuring the regulatory landscape evolves with the needs of the sector.
