Search form

You are here

  • Home
  • Pakistan unveils ambitious five-year strategic plan for Islamic banking sector


Pakistan unveils ambitious five-year strategic plan for Islamic banking sector

In this December 5, 2018 file photo, a brass plaque of the State Bank of Pakistan is seen outside of its wall in Karachi. (REUTERS)
Short Url

https://arab.news/rhqk8

Updated 02 August 2021
Follow

Pakistan unveils ambitious five-year strategic plan for Islamic banking sector

  • Central bank sets targets including Islamic banking reaching 30% share in assets and deposits of overall banking industry, 35% share in branch network
  • Islamic banking industry in Pakistan posted 30% and 27.8% growth in assets and deposits respectively in 2020, highest such increase since 2012
Updated 02 August 2021
KHURSHID AHMED   

ISLAMABAD: The State Bank of Pakistan (SBP) on Monday unveiled its third five-year strategic plan for the Islamic banking industry, setting targets to be achieved by 2025, including reaching 30 percent share in both assets and deposits of the overall banking industry, 35 percent share in the branch network and 10 percent and eight percent share in private sector financing for small and medium sized industries and agriculture respectively.

The Islamic banking industry of Pakistan has posted 30% and 27.8% growth in overall assets and deposits respectively during 2020, the highest such increase since 2012, central bank data shows, driven by increasing access to shariah-compliant financial instruments and growing faith-based demand.

Twenty-two Islamic banking institutions currently operate in Pakistan: five Islamic banks and 17 conventional banks with standalone Islamic banking branches. The State Bank aims to make Islamic banking one third of the overall banking industry in Pakistan by 2025. 

The overall assets of the industry increased to Rs4.3 trillion while deposits reached Rs3.4 trillion by the end of December 2020, accounting for 17% of all assets and 18.3% of all deposits of the country’s entire banking industry, according to the State Bank.

“In order to steer the growth of Islamic banking on sound footings, SBP has been providing proactive guidance through issuance of Strategic Plans for the Islamic banking industry; so far, two five-year Strategic Plans have been issued,” the central bank said in a statement. “This third Strategic Plan for Islamic banking industry (2021-25) aims to set a strategic direction for the industry to strengthen the existing progressive momentum and lead the industry to the next level of growth. The plan has been developed in close coordination and consultation with all key relevant stakeholders.”

The statement added: 

“The strategic plan envisages achieving the aforementioned specified targets by focusing on six strategic pillars namely: (i) strengthening legal landscape, (ii) enhancing conduciveness of regulatory framework, (iii) reinforcing comprehensive Shariah governance framework, (iv) improving liquidity management framework, (v) expanding outreach & market development, and (vi) bolstering human capital & raising awareness.”

Financing for the Islamic banking industry also grew by 16% during 2020, and the non-performing finances (NPFs) to financing (gross) ratio declined from 4.3 %, as of the end of December 2019, to 3.2%, as of the end of December 2020, central bank data shows.

Bankers say the growth in Islamic banking, where under shariah the payment and receipt of interest is strictly prohibited, is driven main due to increasing access.

Sana Tawfik, banking sector analyst at Arif Habib Limited, told Arab News the central bank had been promoting the sector’s development through the introduction of legal, regulatory and shariah-compliant frameworks for instruments such as Naya Pakistan Certificates (NPCs) under the Roshan Digital Account (RDA) initiative, which are available to overseas Pakistanis and those who had declared assets abroad.

“Steps taken by SBP to promote Islamic banking, inflows through RDA in NPCs, Islamic sukuks and the increasing frequency of sukuk auctions are the other couple of reasons driving it,” Tawfik said.

Ahmed Ali Siddiqui, senior executive vice president of Meezan Bank — Pakistan’s first full-fledged Islamic bank — told Arab News there was “stronger public demand” for shariah based or interest free banking.

“It is continuously fueling growth,” he said. “The development of Islamic capital market and availability of financial instruments like Sukuk expedited the growth.”

He added that the COVID-19 pandemic had proven the stability of Islamic banking.

“Surprisingly Islamic banking has shown strongest growth during COVID-19 crisis,” Siddiqui said. “This shows the stability factors of the Islamic economic system based on real economic conditions.”

Topics: Pakistan SBP

Pakistani forces kill 27 militants in insurgency-hit Balochistan province

Updated 5 sec ago
Follow

Pakistani forces kill 27 militants in insurgency-hit Balochistan province

  • Balochistan, Pakistan’s largest province by landmass and rich in mineral resources, has been the site of a low-level insurgency by Baloch separatists
  • Separatist militants last week seized Zehri town in Balochistan’s Khuzdar district, setting government property on fire and robbing Rs768,000 from a bank
Updated 5 sec ago
Arab News Pakistan

ISLAMABAD: Pakistani security forces have killed 27 militants in the southwestern Balochistan province, the military said on Monday, in the latest incident in the insurgency-hit region.
The militants were killed in an intelligence-based operation in Balochistan’s Kacchi district, according to the Inter-Services Public Relations (ISPR), the military’s media wing.
The deceased had been involved in militant activities against security forces as well as innocent civilians and were “highly wanted” by the law enforcement agencies.
“Multiple hideouts, including caches of arms, ammunition and explosives, were also destroyed during the operation,” the ISPR said in a statement.
Balochistan, Pakistan’s largest province by landmass and rich in mineral resources, has long faced a low-level insurgency led by separatist groups, who accuse Islamabad of exploiting the province’s natural resources, such as gold and copper, while neglecting the local population.
Successive Pakistani governments have denied the allegations, saying they prioritized Balochistan’s development through investments in health, education and infrastructure projects.
On Monday, a roadside bomb blast killed one person in Balochistan’s Turbat district, while dozens of ethnic Baloch separatists last week entered Zehri town in the Khuzdar district and seized control of its main market, setting government properties on fire and robbing Rs768,000 ($2,745) from a private bank.
Footage and pictures seen by Arab News showed armed fighters roaming the streets of the town after seizing weapons, vehicles and motorbikes from the Levies paramilitary force. The outlawed Balochistan Liberation Army (BLA) separatist group claimed responsibility for the attack.
Security forces reclaimed the town following skirmishes with the militants, during which one soldier was injured. Provincial authorities later sacked 15 Levies personnel for showing “cowardice” by surrendering to armed militants, according to a government notification.
Violence by Baloch separatist factions, primarily the BLA, killed about 300 people last year, according to official statistics, marking an escalation in the decades-long conflict.

Topics: militancy in Pakistan Balochistan Liberation Army Balochistan Attacks

Pakistan, Bangladesh vow to strengthen trade ties, consular services

Updated 5 min 4 sec ago
Follow

Pakistan, Bangladesh vow to strengthen trade ties, consular services

  • Pakistan and Bangladesh have sought to improve bilateral ties since former premier Hasina’s ouster
  • Established together as one nation in 1947, Bangladesh won liberation from Pakistan in 1971 with India backingEstablished together as one nation in 1947, Bangladesh won liberation from Pakistan in 1971 with India backing
Updated 5 min 4 sec ago
Arab News Pakistan

ISLAMABAD: Islamabad and Dhaka have vowed to strengthen ties, particularly in trade and consular services, the Pakistan embassy said on Monday after the consul general of Bangladesh in Dubai paid a courtesy call on his counterpart from Pakistan. 

Pakistan and Bangladesh share a complex history, having been a single country known as East and West Pakistan until Bangladesh was born in 1971 after a war of liberation backed by Pakistan’s arch-rival and neighbor India. Nearly three million people were killed in the conflict.

Ties reached a new low in 2016 when Bangladesh executed several leaders of its Jamaat-e-Islami party on charges of committing war crimes in 1971. Pakistan called the executions and trials “politically motivated,” arguing that the convicts were being punished for taking a pro-Pakistan stance during the war. 

However, Islamabad’s ties with Dhaka improved after Prime Minister Sheikh Hasina was ousted last year after student-led violent protests in the country. Hasina fled to India, which has cast a shadow over the relationship between Dhaka and New Delhi in recent months, with the former repeatedly demanding that India extradite the ousted leader.

“H.E. Md. Rashedujjaman, Consul General of Bangladesh in Dubai paid a courtesy call on H.E. Hussain Muhammad, Consul General of Pakistan, at the Consulate General of Pakistan today [Monday],” the Pakistani consulate said in a statement. 

“Welcoming the visiting Consul General, Mr. Hussain emphasized the importance of strengthening ties between Bangladesh and Pakistan, particularly in trade. Both Consuls General acknowledged the potential for collaboration and agreed to engage their respective consulates’ trade sections to further promote bilateral cooperation.”

Both sides also discussed various consular services including passport issuance, national identity cards, and visa procedures.

“Both Consuls General agreed to enhance information sharing and future collaboration regarding community services and public awareness initiatives,” the statement said.

Topics: Pakistan Bangladesh Ties Pakistan consulate Dubai

Pakistan voices concern over recent ‘Islamophobic’ remarks against British-Pakistanis in UK

Updated 56 min 38 sec ago
Follow

Pakistan voices concern over recent ‘Islamophobic’ remarks against British-Pakistanis in UK

  • The development comes amid a debate around child sexual abuse in the UK, with an inquiry report accusing some Pakistani origin men of involvement
  • Islamabad says such remarks are aimed at ‘conflating’ reprehensible actions of a few individuals with the entire 1.7 million British-Pakistani diaspora
Updated 56 min 38 sec ago
SAIMA SHABBIR

ISLAMABAD: Pakistan’s Foreign Office on Monday expressed “deep concern” over a recent spate of “Islamophobic” remarks directed toward the Pakistani community in the United Kingdom (UK), saying they were aimed at “conflating” reprehensible actions of a few individuals with the entire 1.7 million British-Pakistani diaspora.
The development comes amid a debate around grooming gangs in the UK after British Safeguarding Minister Jess Phillips rejected Oldham Council’s request for a government-led inquiry into a historical child sexual abuse scandal in the town in favor of a local investigation. The grooming scandal, which came to light in the 2010s, involved the systematic abuse of thousands of girls in towns such as Rotherham, Rochdale and Oldham. A 2014 report estimated that 1,400 children were exploited in Rotherham between 1997 and 2013, primarily by men of Pakistani origin.
Indian nationalist lawmaker Priyanka Chaturvedi this month sparked the controversy by stating that the blame for grooming gangs in the UK should not be attributed to Asia as a whole, but rather to one “rogue nation.” Tech billionaire Elon Musk also endorsed the anti-Pakistan narrative on X and criticized British Prime Minister Keir Starmer for rejecting calls for a new national inquiry and instead advocating the implementation of recommendations of an earlier seven-year inquiry.
In its response to media queries about the controversy, the Pakistani Foreign Office said British nationals of Pakistani origin had a rich history of contributing to the UK’s growth, development and, indeed, freedom, with an “exceptionally large” number of predominantly Muslim soldiers from what is now Pakistan serving in the British Indian army and laying down their lives in both World Wars.
“We note with deep concern the increasingly racist and Islamophobic political and media commentary in the UK that is aimed at conflating the reprehensible actions of a few individuals with the entire 1.7 million British Pakistani diaspora,” it said in a statement.
The Foreign Office said that the Pakistan-UK friendship is characterized by warmth, cordiality, robust cooperation and trust, noting that British-Pakistanis formed the “backbone of the UK’s health, retail and services sectors.”
“Many British Pakistanis hold high public office, and thousands serve their communities as Members of Parliament, mayors, councillors, and as members of local police and municipal services. British Pakistanis have excelled in sports and arts. Their cuisine and music enriches British culture,” it said.
“To demonize such a large and diverse community on the basis of the actions of a few individuals needs to be condemned.”
It said the multifaceted Pakistan-UK relations cover important areas, including trade and investment, education, security and counter-terrorism, and the presence of 1.7 million strong British-Pakistani diaspora provides the strongest link between the two friendly countries.

Topics: Pakistan UK Ties British Pakistanis Foreign Office of Pakistan overseas pakistanis

Pakistan’s Bank Alfalah acquires nearly 10 percent stake in UAE fintech Jingle Pay

Updated 13 January 2025
Follow

Pakistan’s Bank Alfalah acquires nearly 10 percent stake in UAE fintech Jingle Pay

  • Jingle Pay plans to launch its digital banking services in Pakistan in the first quarter of 2025 as a branchless banking mobile app
  • Only 60 percent of Pakistan’s 137 million adult population, or 83 million adults, have a bank account, according to central bank estimates
Updated 13 January 2025
KASHIF IMRAN

ISLAMABAD: Bank Alfalah, a leading Pakistani commercial bank, on Monday announced it had acquired 9.9 percent equity stake in Dubai-based fintech firm Jingle Pay, underscoring the bank’s commitment to driving digital transformation and fostering financial inclusion in Pakistan and across other markets.
With over 1,000 branches across 200 cities and an international presence in the United Arab Emirates, Bahrain, and Afghanistan, Bank Alfalah offers various products and services to private-sector institutions and governments, and has established itself as a premier digital bank.
Jingle Pay, on the other hand, has redefined the fintech space with its proprietary AI-powered tech stack already processing over 2 million transactions and facilitating over $1 billion in international money transfers in 2024, saving customers over $6 million in fees. It was recently awarded the top global fintech for remittances into Pakistan.
Bank Alfalah said its equity investment and appointment to Jingle Pay’s board signal a robust partnership aimed at driving growth and innovation, and the collaboration leverages its extensive infrastructure to amplify Jingle Pay’s impact on cross-border payments and digital banking, advancing its ambitious vision for the Middle East and North Africa and Afghanistan and Pakistan (MENAP) region.
“This acquisition is a milestone in our journey to lead the digital banking revolution,” said Farooq A. Khan, Bank Alfalah’s group head for corporate, investment banking and international business.
“By combining Jingle Pay’s innovative platform with Bank Alfalah’s resources, we aim to redefine cross-border financial services and deliver exceptional value to millions of users.”
Pakistan, with a population of 240 million, is home to one of the world’s largest unbanked populations. Only 60 percent of its 137 million adult population, or 83 million adults, have a bank account, according to central bank estimates.
Jingle Pay plans to launch its digital banking services in Pakistan in the first quarter of 2025 as a branchless banking mobile app targeting to bring seamless and inclusive financial services to the country’s unbanked population.
The partnership aims to create synergies in cross-border payments strengthened by shareholder MoneyGram.
“Partnering with Bank Alfalah empowers us to scale our vision of inclusive finance,” Jingle Pay Chief Executive Officer Amir Fardghassemi was quoted as saying by Bank Alfalah.
“Together, we aim to enrich the digital economy and create transformative cross-border financial solutions.”

Topics: Bank Alfalah Jingle Pay

Pakistan to launch indigenous satellite to predict disasters, monitor resources on Jan. 17

Updated 13 January 2025
Follow

Pakistan to launch indigenous satellite to predict disasters, monitor resources on Jan. 17

  • Electro-Optical (EO-1) satellite can provide timely updates on floods, landslides and earthquakes, says state media 
  • Satellite can also support conservation strategies by monitoring minerals, oil and gas fields, and glacier recession
Updated 13 January 2025
Shahjahan Khurram

ISLAMABAD: Pakistan’s national space agency announced on Monday that it would launch the country’s first indigenous Electro-Optical (EO-1) satellite on Jan. 17, state-run media reported, to help enhance monitoring of natural disasters and manage natural resources efficiently. 

The EO-1 satellite will be launched from China’s Jiuquan Satellite Launch Center, the state-run Associated Press of Pakistan (APP) reported. It added that its launch represents the Space and Upper Atmosphere Research Commission’s (SUPARCO) dedication and expertise in advancing Pakistan’s technological capabilities in space science.

The state media said the satellite will enhance the country’s ability to monitor and manage natural resources, predict and respond to natural disasters, support food security and drive economic growth through informed decision-making and sustainable development.

“The EO-1 satellite offers substantial benefits across various sectors in Pakistan,” APP said. “In agriculture, it will enable precision farming by monitoring crops, assessing irrigation needs, predicting yields and supporting food security initiatives.”

The report said that in urban development, the satellite can help in tracking infrastructure growth, managing urban sprawl and aiding city and regional planning efforts. 

“In environmental monitoring and disaster management, it will provide timely updates on floods, landslides, earthquakes, deforestation, and land erosion,” it added. 

The EO-1 satellite will also support extraction and conservation strategies for natural resources, such as the monitoring of minerals, oil and gas fields, glacier recession and water resources.

“The launch of the EO-1 satellite marks a momentous milestone in Pakistan’s space journey,” APP said. 

Pakistan has taken strides in its space research program in the past few months. In November 2024, SUPARCO announced its rover will join China’s Chang’E 8 mission to explore the moon’s surface in 2028.

In May 2024, Pakistan launched its first lunar satellite aboard China’s Chang’e-6 probe, which was tasked with landing on the far side of the moon that perpetually faces away from the Earth. China was the first country to make such an ambitious attempt.

Topics: Pakistan Electro-Optical (EO-1) satellite suparco

Latest updates

UK’s Starmer urged to fire minister hit by Bangladesh graft probe
Britain’s Keir Starmer faced fresh pressure Monday to sack his anti-corruption minister Tulip Siddiq. (File/AFP)
Pakistani forces kill 27 militants in insurgency-hit Balochistan province
Pakistan, Bangladesh vow to strengthen trade ties, consular services
Nortje back in South Africa squad for Pakistan-hosted Champions Trophy
Pakistan voices concern over recent ‘Islamophobic’ remarks against British-Pakistanis in UK

Search form

Print Edition
Read pdf version Subscribe now
© 2025 SAUDI RESEARCH & PUBLISHING COMPANY, All Rights Reserved And subject to Terms of Use Agreement.