The State Bank of Pakistan (SBP) has evolved a strategic plan to introduce Islamic banking in the country by launching a survey-based report ‘Knowledge, Attitude and Practices of Islamic Banking in Pakistan’.At the launching ceremony of the report, Governor Ashraf Mahmood Wathra askedtraders and industrialists to focus on research and development in their respective domains to evolve innovative financial solutions and meet the growing demand of Islamic banking in local and international markets. According to the report, the Islamic banking has exhibited stability and resilience in the wake of financial crisis and has been widely recognised as a viable and competitive component of the financial system. There is no concept of exploitation in the Islamic banking and the balanced approach of this system to generate productive economic activities, transparency, social justice and equitable distribution of wealthas well as its abilityto avoid risks have made it acceptable to even various non-Muslim economies in the global financial market.
The SBP survey, with nation-wide representation of 9,000 households and 1,000 corporate, has quantified the demand for Islamic banking in the country at retail and corporate levels and has also identified the gap between demand and supply. The survey indicates that there is a tremendous scope for Islamic banking system in rural and urban areas.The survey emphasizes the role of Islamic scholars to create awareness about Islamic banking in the country. The survey points out that agriculture and microfinance sectors can be the potential markets for the Islamic banking.
The Islamic Banking Industry in Pakistan has been growing since it was re-launched in 2001 and it represents 10 percent of the overall banking system with 19 banking institutions offering products and services under the Islamic banking.
According to the SBP, the five-year strategic plan,from 2014 to 2018, is an effort to develop an industrywide consensus on the future direction of the financial industry and face key issues and challenges besides improving the public perception of Islamic banking in Pakistan.
