The Pakistan Stock Exchange (PSX) has launched a Shariah-compliant trading counter after the Securities and Exchange Commission of Pakistan (SECP) approved the governing Shariah Trading Counter Regulations. The counter is meant to give both retail and institutional investors a single platform for investing in line with Islamic principles.
A gong ceremony marked the launch. Representatives of the SECP, the State Bank of Pakistan (SBP), the Central Depository Company (CDC), the National Clearing Company of Pakistan (NCCPL) and the Pakistan Stock Brokers Association (PSBA) attended, along with Shariah scholars and participating brokerage houses.
Brokers and rules governing the new counter
According to the PSX, 39 brokerage firms have come on board to offer Shariah-compliant trading through dedicated Islamic windows, and two more brokerages hold licences to work exclusively as Shariah-compliant brokers.
Trading is confined to Shariah-compliant equities, Government Ijarah Sukuk and Corporate Sukuk, with non-compliant securities excluded. Interest-based leverage products such as MTS are blocked, and Murabaha Share Financing (MSF) is offered as the compliant alternative. Short selling and derivatives trading are also barred, although investors may sell non-compliant holdings to align their portfolios with Shariah requirements.
A new Shariah Portal on the PSX Data Portal lists every Shariah-eligible stock and Sukuk. Investors, including those opening Sahulat Accounts, must complete their paperwork through a Shariah-compliant Customer Relationship and Risk Disclosure Document.
Investor growth and officials’ outlook
PSX managing director and chief executive Farrukh H. Sabzwari said the counter would improve access to Islamic investment through a dedicated trading environment backed by system-based compliance controls. He added that investor accounts at the exchange had passed 650,000, with millennials and Generation Z making up a large share of new participants.
Sabzwari said the initiative was expected to draw further investment from Pakistan’s predominantly Muslim population. SECP Commissioner Imtiaz Haider said it could widen market participation and create opportunities for investors and the brokerage industry, noting that a significant proportion of listed equities and mutual fund assets were already Shariah-compliant.
Dr. Tariq Naseem, Head of Islamic Finance at the SECP, outlined the next steps: expanding digital retail Sukuk, introducing Shariah-compliant tools for liquidity and risk management, and strengthening the legislative framework for Islamic financial services.
