Islamic Banking in Pakistan

ISLAMABAD  – More than half of $5 billion Roshan Digital Account (RDA) inflows during the last two years came through Islamic banking accounts, which shows the burgeoning growth of the Islamic banking industry in Pakistan.

The RDA received more than $5 billion dollars through 456,732 accounts of overseas Pakistani from 175 countries within two years of its launch. Deputy Governor of SBP Dr Murtaza Syed said that more than half of Roshan Digital Accounts had been opened in Islamic banks and 50% of $3.18 billion investment was made in the Islamic Naya Pakistan Certificates. RDA was launched by SBP in September 2020. The scheme got rapidly popular among overseas Pakistanis. A government-backed digital account facility is being offered by Pakistan’s retail banking sector to cater to the needs of Islamic consumer financing of Pakistani expatriates. The scheme provides expatriates with the opportunity to acquire property and motor vehicles in their home country while living abroad. “In recognition of overseas Pakistanis’ preference for the Islamic version of Roshan Digital Accounts, SBP hopes that more expatriate Pakistanis out of the nine million will take advantage of RDA and its various features in the future,” said Dr Murtaza Syed. Dr Murtaza Syed said that RDA gained global recognition as brother country Turkey worked with the SBP team to implement its own version of the programme. The SBP is planning to enhance the menu of services under the scheme. The central bank wants to introduce insurance products, Takaful, pension plans and services for non-resident Pakistanis, who have more than 50% ownership of local entities, to open their accounts in both local currencies as well as foreign currency. It is difficult for Pakistanis living abroad to find Islamic products for investments in foreign countries, even though there are a limited number of options.

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