Islamic Banking has taken off in Pakistan: Faiz


Surpasses 20% Market Shares

Senior Economist Faiz Ul Haq has apprised that as per international standards, Islamic Banking has taken off in Pakistan; *as its market share has surpassed & sustained above 20 percent successfully* – both in terms of assets and deposits.

As per banking industry sources,* he apprised that, *market share of Islamic Banking in terms of assets stands at 20 percent and 21 percent in terms of deposits.* It is a major milestone in the history of Islamic Finance in Pakistan and it is, in fact, *no less than a psychological barrier for any product category in any industry or sector.*

Renowned Economist Faiz Ul Haq articulated that there are *three very significant developments on legal, policy and regulatory landscape of Pakistan;* which every banking & finance professional would have to take into account to understand the future of banking in Pakistan:

(i) Federal Shariat Court (FSC) has ruled that the government has to make Pakistan an interest & riba-free country by the end of year 2027, i.e. December 31, 2027 (ii) In an astounding and far-reaching decision, now incumbent federal minister for finance & revenue, Senator Ishaq Dar, has decided to take back the appeals against the aforementioned FSC decision file by the State Bank of Pakistan (SBP) and National Bank of Pakistan (NBP) (iii) SBP will be setting up a special wing for transition to interest-free banking in a week’s time from now.*

As per the emerging scenario in the years to come, Faiz Ul Haq added that, the stated developments are going to change the banking & financial services industry in Pakistan for perpetuity. Additionally, on ground, *two major governmental institutions are going to go under major and strategic reforms for a long-drawn-out-period for certain; that are SBP and Securities & Exchange Commission of Pakistan (SECP).*

Faiz Ul Haq substantiated his reading by saying that 90 percent of the corporate sector is being regulated by SECP and all the banking sector by SBP; therefore, *expected strategic changes at these two institutions will follow* to implement the decisions mentioned above.