The Pakistan Stock Exchange (PSX) has launched its Shariah-Compliant Trading Counter, creating a dedicated trading environment for retail and institutional investors seeking Islamic investment opportunities.
The launch follows approval of the Shariah Trading Counter Regulations by the Securities and Exchange Commission of Pakistan (SECP). A gong ceremony marked the occasion, attended by representatives of the SECP, State Bank of Pakistan (SBP), Central Depository Company (CDC), National Clearing Company of Pakistan Limited (NCCPL), Pakistan Stock Brokers Association (PSBA), Shariah scholars and participating brokerage houses.
According to PSX, 39 brokers have joined the initiative to offer Shariah-compliant trading through Islamic windows, while two additional brokerage houses hold licences to operate as fully Shariah-compliant brokers.
Trading restricted to Shariah-compliant securities
The new counter operates under procedures and regulations prescribed by PSX and approved by the SECP. It allows trading in Shariah-compliant equities, Government Ijarah Sukuk and corporate Sukuk.
The system prohibits transactions in non-compliant securities and restricts activities that do not meet the counter’s Shariah requirements. Interest-based leverage products, including Margin Trading System (MTS), are blocked.
Instead, investors can access Murabaha Share Financing (MSF) as a Shariah-compliant financing alternative. Short selling and derivatives trading are also prohibited under the counter’s rules.
Investors can sell non-compliant holdings to help purify their portfolios in accordance with applicable Shariah principles.
New portal identifies eligible stocks and Sukuk
PSX has also introduced a dedicated Shariah Portal on its Data Portal, listing stocks and Sukuk eligible for trading through the new counter.
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Investors can open accounts, including Sahulat Accounts, using a Shariah-compliant Customer Relationship and Risk Disclosure Document.
The dedicated framework aims to combine access to Islamic investment products with system-based compliance controls, giving investors a defined route to participate in the capital market.
PSX highlights opportunities for wider participation
Farrukh H. Sabzwari, Managing Director and Chief Executive Officer of PSX, said the initiative would improve access to Islamic investment opportunities and strengthen investor confidence.
“By providing a dedicated trading environment supported by system-based compliance controls, this initiative enhances investor confidence, improves accessibility to Islamic investment opportunities, and further strengthens the country’s Islamic capital market ecosystem,” he said.
Sabzwari noted that investor accounts had exceeded 650,000, with Millennials and Generation Z contributing significantly to new participation. He added that the counter could attract more investors from Pakistan’s predominantly Muslim population.
SECP sees potential for Islamic capital market growth
Imtiaz Haider, Commissioner at the SECP, said a significant proportion of listed equities and mutual fund assets were already Shariah-compliant.
He said the new initiative could broaden market participation, create opportunities for investors and brokerage firms, and strengthen confidence in Shariah-compliant investment options.
Dr Tariq Naseem, Head of Islamic Finance at the SECP, outlined further priorities for developing Pakistan’s Islamic financial markets. These include expanding digital retail Sukuk, introducing Shariah-compliant tools for liquidity and risk management, and strengthening the legislative framework for Islamic financial services.
The launch marks a further step in the development of Pakistan’s Islamic capital market, providing investors with a dedicated mechanism to trade eligible securities under a defined Shariah-compliant framework.
