In a landmark development for the growth of Islamic finance in the non-bank financial sector, the Securities and Exchange Commission of Pakistan has issued Guidelines for Offering Islamic Financial Services, 2023, covering all its regulated sectors.
The guidelines are framed to facilitate the growth of Shariah-compliant financial products in the financial services market regulated by the Commission, which includes Islamic capital markets, Takaful, Modarabas, NBFCs, pension, and private funds, REITs, and so on, said a press release issued by SECP.
The guidelines are based on notions of proportionality and gradualism and cover key principles for the conduct of Shariah-compliant operations by persons offering Islamic financial services.
It also introduces the concept of “Islamic windows” in all regulated sectors, apart from providing detailed guidelines for the conversion of conventional financial institutions into Islamic financial institutions.
Another essential aspect covered in the guidelines is the foundational principles for developing cohesive Shariah governance within Islamic financial institutions.
Issuance of these guidelines is part of SECP’s resolve to promote and develop an Islamic financial system in line with the constitutional objective of the Islamization of the economy in light of the recent judgment of the Federal Shariah Court.—APP