ISLAMABAD: Pakistan’s interim finance minister Dr. Shamshad Akhtar inaugurated a centralized gateway portal (CGP) on Friday, saying it would help develop debt market in the country by listing government securities to promote retail participation, transparency, savings channelization, and overall market growth.
Debt or bond markets constitute financial arenas in which people buy and sell various types of debt securities representing loans made by investors to entities such as governments, corporations, or other organizations.
These securities are typically issued with the promise of periodic interest payments to bondholders and the repayment of the principal amount at maturity.
According to a statement released by the Securities and Exchange Commission of Pakistan (SECP), the CGP is a novel financial initiative to facilitate simultaneous onboarding of investors and customers across the securities market, the nonbank financial companies’ sector, and the insurance industry.
The platform features standardized, one-time know-your-customer requirements across diverse asset classes.
“Dr. Shamshad Akhtar, the Federal Minister for Finance & Revenue, said that the securities market can play a vital role in the development of debt market through the listing of government debt securities on PSX [Pakistan Stock Exchange],” said the SECP statement.
Addressing the inauguration ceremony, Akhtar said the issuance of securities through public auctions at PSX would facilitate greater transparency.
“One of the key issues undermining the growth of capital markets is the lack of liquidity which is directly attributable to the small number of investors,” she was quoted as saying.
The minister said the CGP would provide immense opportunities to investors and great convenience to market intermediaries by removing duplications and streamlining the customer onboarding process.
However, she noted the successful CGP launch should not be deemed the end of the project.
“Having developed this promising digital platform, we are now faced with the critical part of realizing the potential it offers,” she continued. “This requires focused marketing efforts and promotion on the part of the PSX and other stakeholders like brokers, insurance companies, and AMCs [asset management companies].”
The minister pointed out that attracting new investors in the capital market should be one of the primary objectives, adding it would require coordinated efforts from all capital market infrastructure institutions, market intermediaries and brokerage houses under the SECP guidance.
