IslamicFinance.de

The common belief goes that Islamic finance or banking is for Muslims only. However, this is not true. Islamic finance and banking attempts to build a financial system based on ethics and fairness, havin thus an effect on the socio-economic conditions of the market it is implemented in. Therefore, people of any belief can make use of it. The problem is the lacking awareness about Islamic finance in Pakistan as well as worldwide. Optimized solutions for proper display of Islamic products and for bridging the communication gap between the Shariah councils issuing the fatwas pursuant to Islamic Finance, and the managers drafting the advertisements are sought.

The court in Sindh provice registered a petition of five Pakistan's takaful operators as a sign of protest againts the new rules for insurance sector that was launced last month. Accordint to them, conventional insurance firms would become right to offer takaful services. It would make Pakistan the second Islamic country after Indonesia where takaful windows are officially allowed. The court has been adjourned to an unknown date.

New takaful rules have been introduced by Pakistan's regulator. They were designed to boost competition and to lift the sector's market share by allowing the entry of conventional players. Consequently, Pakistan became the second country after Indonesia to officially allow takaful windows. Since the introduction of the first rules in 2005, Takaful has operated without conventional competitors in Pakistan. However, those rules allowed windows after a five-year period. As the securities commission said last month, conventional insurance firms could serve a vaster share of the takaful market.

Standard Chartered arranges a one-year $35 million Islamic structured trade finance facility for Pakistan International Airlines (PIA). This transaction has been arranged and structured solely by the bank. The facility is structured as an Islamic offshore transaction. It uses innovative services Ijara concept-based on purchase and distribution of airline seats.

Shortly after Securities and Exchange Commission of Pakistan (SECP) waived the previous conditions that forbade conventional insurance companies from launching Takaful operations, State Life Insurance Corporation came with news. The largest insurance company in the country plans to launch its own new range of Islamic insurance within a year. Currently, they are assessing target market for Takaful.

S&P Indices made an anouncement that a new Index will be launched due to increase in the demand for a shariah-compliant benchmark in Islamic countries. The new S&P/OIC COMCEC 50 Shariah Index will measure the performance of 50 leading Shariah-compliant companies from members of the Organisation of Islamic Cooperation (OIC). Eligible countries and territories for the Index are: Bahrain, Bangladesh, Côte d'Ivoire, Egypt, Indonesia, Jordan, Kazakhstan, Kuwait, Lebanon, Malaysia, Morocco, Nigeria, Oman, Pakistan, Qatar, Saudi Arabia, Tunisia, Turkey and the United Arab Emirates.

Aproximatly 100 investment projects worth 300 billion roubles have been introduced at the 4th International Summit in Kazan.
The organizers of the forum were the government of Tatarstan, the Islamic Business & Finance Development Foundation (IBFD) with the support of the Federation Council of Russia.
The summit is attended by thousands of guests from over 30 countries of the Organisation of Islamic Cooperation including: Azerbaijan, Bahrain, Egypt, Kazakhstan, Kuwait, Morocco, Turkey, the UAE, Oman, Pakistan.

The Security Exchange Commission of Pakistan (SECP)’s move to push Sharia-compliant Takaful risk coverage in Pakistan is probable to benefit millions and to triple the percentage of citizens with insurance coverage, in which Pakistan ranks lowest in South Asia.
Islamic insurance can benefit those who do not subscribe to conventional insurance, which is forbidden by Sharia Law.

The Pakistan Economy Watch (PEW) noted SECP’s move to push Sharia compliant risk coverage in Pakistan is to benefit millions. The move could triple insurance density and penetration in which Pakistan ranks lowest in the region.
Takaful, for example, has been growing 15 per cent annually. Furthermore, in 2011 it grew 31%. Contrary to conventional insurers who charge money to cover the risks, Takaful spread the risk and rewards among all participants.
Dr. Murtaza Mughal, President of the PEW, requested SECP to supervise and ensure cost-effective and competitive financial protection to the people, push companies to focus small cities and towns and initiate efforts for flow of information aimed at community development.

Takaful is coming out globally as a very viable model and being used successfully as engine of growth in a number of Muslim countries. The statement came from Chief Executive Officer Pak-Qatar Takaful, Pervaiz Ahmad while speaking at Lahore Chamber of Commerce and Industry.
He added that, despite of the fact that it is an untapped market, Islamic mode of banking and all its tools are fast gaining ground in Pakistan when compared to conventional mode of banking.
It seems that Islamic financing products such as Murabaha, Ijara, Musharaka and Islamic Export Refinance, etc, are catering to a diverse cross-section of the economy, including corporate, SME and consumer sectors.

The World Congress of Muslim Philanthropists (WCMP) and Pakistan’s Islamic microfinance institution Farz Foundation have signed a Memorandum of Understanding. The foundation and the WCMP will cooperate in developing Shari’ah-compliant product based on need and innovation. WCMP will copy Farz methodology in Pakistan and outside, especially in the less developed Muslim countries.
Farz Foundation represents Pakistan’s first Shari’ah-compliant Islamic microfinance institution.

Islamic Banking Department was set up in Pakistan on 15th September, 2003 and has been authorized with the task of promoting & developing the Shariah Compliant Islamic Banking as a parallel and compatible banking system in the country. Islamic Banking is one of the arising field in global financial market, having more and more success throughout the world.
At this point there are six licensed fully fledged Islamic Banks and twelve conventional banks with standalone Islamic Banking Branches with the total branch network of over 336 branches performing in more than 50 cities of all the four provinces.

The State Bank of Pakistan has awarded Silkbank with an Islamic banking license.
The bank will be initially aiming Pakistan’s main population centers, Karachi, Lahore, Islamabad and Faisalabad.

Inspite of the extraordinary potential of the country, financial institutions in Pakistan are still not taking Islamic micro financing seriously.
According to Al Baraka Bank Chief Operating Officer Ahmed Shuja Kidwai, Islamic micro finance is notably important for Pakistan because it’s a developing economy and has a huge untapped market. He added that he was one of those managers who believe in learning the fundamentals of a market and analyzing how to make it into a success.
He gave as examples the following countries: Italy, Iran, India and Malaysia, which have grown their industries through micro financing in just 10-15 years.

The growth of low-cost carrier flydubai is almost double compared to its launch in October 2010 in Pakistan despite heavy competition and slump in the industry.
The aviation industry has an important role in strengthening ties between UAE and Pakistan, which is evident from the growing number of air travellers between both countries.
The event was organised at Karachi Expo Centre parallel to UAE Expo 2011.

The World Congress of Muslim Philanthropists (WCMP) and Pakistan’s Islamic microfinance institution Farz Foundation have singed a Memorandum of Understanding to further empower their partnership.
The two will work together in developing Shariah compliant, need based and market driven innovative products. They will also design the strategies to carry out the products' operations to kick start the Halal income generating cycle.
WCMP will copy Farz Methodology in Pakistan and outside, especially in the less developed Muslim countries.

The Islamic Development Bank’s community development workshop has the purpose to empower Muslim NGOs in different parts of the world by offering them necessary training to boost their leadership skills.
Prominent leaders of Muslim organizations and institutions in 14 countries including Australia, Bangladesh, Brazil, c and the Philippines who had come to the Kingdom to perform Haj this year, including professor Siddique Hassan, vice president of Jamaat-e-Islami Hind, will be included in the program.

While Pak-Qatar does recruit from all types of secular educational institutions, it also makes it a point to guarantee that religious seminary students are not left out from its recruitment drives.
Pak-Qatar is nowadays one of the smaller life insurance companies in Pakistan, whith just over Rs1 billion in assets, but the company plans on expanding rapidly across the country and having its own retail sales force is a key part of its strategy.

Dubai Islamic Bank Pakistan Limited (DIBPL) has planned to open 25 new branches in various cities of Pakistan by next year.
Junaid Ahmed, President and CEO DIBPL, stated that since starting operation in Pakistan in 2006, the bank has 72 branches. He added that under its consumer banking division, the bank is offering state-of-the-art Sharia compliant products that effectively compete with those being provided in the market by conventional banks.

State Bank of Pakistan (SBP) has issued Guidelines for Islamic Microfinance Business by Financial Institutions.