SECP approves Islamic brokerage window for five brokers

ISLAMABAD, May 11: The Securities and Exchange Commission of Pakistan (SECP) has allowed five securities brokers to launch dedicated Shariah compliant brokerage services through Islamic windows, enabling investors to carry out halal stock market investments.
The segregated Islamic trading operations are expected to expand Shariah compliant investment opportunities in Pakistan’s capital market and attract both retail and institutional investors seeking Islamic financial products.
Under this arrangement, brokers will invest clients’ funds only in Shariah compliant shares, Sukuk, and Islamic Exchange Traded Funds (ETFs) through separate Islamic brokerage operations maintained by the approved brokers.
The approvals for establishing dedicated Islamic windows at brokerage houses were granted after reviewing the brokers’ operational models, governance structures, compliance arrangements, and Shariah opinions.
Under the approved framework, brokers will maintain separate Islamic operations, including dedicated systems and segregated client and house bank accounts with Islamic banks, to ensure transparency and compliance with Shariah principles.
Trading through these Islamic windows will be restricted to Shariah compliant listed companies, including constituents of the PSX-KMI All Share Islamic Index, as well as Sukuk and Islamic ETFs.
The Islamic window model is a phased and facilitative approach designed to enable conventional brokerage houses to gradually develop and expand Shariah compliant services within the existing regulatory framework. Based on international best practices, the model is expected to support the long term growth of Pakistan’s Islamic capital market.
The dedicated Islamic brokerage windows will help attract more retail and institutional investors seeking Shariah compliant investment opportunities. The initiative will also strengthen the development of an inclusive and ethical financial system in Pakistan.
The SECP has been undertaking continuous reforms to promote Islamic finance as a key pillar of an inclusive, resilient, and ethically driven financial ecosystem. Ends