ISLAMABAD: Pakistan’s State Minister for Finance Ali Pervaiz Malik said on Tuesday new Shariah-compliant certificates worth $178.6 million would be launched this month to facilitate lending activity under an interest-free system, state-run media reported.

A Shariah-compliant certificate is a document issued by the Federal Shariah Court verifying that a financial product or transaction conforms to Islamic principles and laws. Last year, the Securities and Exchange Commission of Pakistan (SECP) issued the first-ever Shariah-compliant certificate to two real estate investment trusts. In April, it also issued a license to the first Shariah-compliant brokerage house in Pakistan.

“In response to the Calling Attention Notice, Minister of State for Finance Ali Pervaiz Malik said new Shariah-compliant certificates worth $178.6 million will be launched this month,” Radio Pakistan said on Tuesday, as the minister briefed the National Assembly about the government’s “commitment to promoting Islamic banking” in the country. 

Earlier this week, Pak-Qatar Family Takaful Limited (PQFTL), a leading Pakistani Shariah-compliant family insurance provider, introduced an instant withdrawal facility for its customers, which would allow participants to withdraw partial funds in case of emergencies with ease and instant access through the company’s mobile app or its online portal. 

Last year, Pakistan’s central bank set a target to increase the share of Islamic banking in the country to 35% by 2025.

In 2021, the Federal Shariat Court, which determines whether Pakistani laws comply with Islamic law, directed the government to eliminate interest from the country’s banking system by 2027. 

At present, the share of Islamic banking in the overall commercial banking system in the country is 20%.

Pakistan has six full-fledged Islamic banks offering a wide range of products and the annual growth rate of Islamic banks’ assets and deposits has been 25% and 22% respectively over the last five years, according to central bank data.