Development of Islamic Banking in Pakistan: Challenges and Prospects
Keywords:Islamic Banking, Islamic Finance, Pakistan, Prospects, Development, Challenges
The study assesses the development and progress of Islamic banking initiative in Pakistan and further attempts to highlight the major challenges faced by the Islamic banking sector to gauge the future prospects of Islamic banking in the country. The research findings are based on qualitative research approach using both primary and secondary data including the historical reports, facts and figures along with the interview data collected from the most important Islamic banking stakeholder groups including the Islamic banking industry regulators comprising of officials from The State Bank of Pakistan (SBP) as well as the Shariah and Islamic banking experts serving at various Shariah Supervisory Boards (SSBs) in the country’s Islamic banking sector. The study is undertaken by conducting interviews of nine SBP officials and twelve Shariah supervisors. The study is the first of itself in Pakistan as the previous studies focused stakeholder groups like customers and bankers only but this study takes into account the views and opinions of Islamic banking industry regulators and Shariah scholars serving in the Islamic banking sector. The research findings highlighted that Islamic banking initiative in Pakistan experienced a difficult journey but gained momentum with the passage of time and there are still several challenges that must be aptly addressed to ensure a brighter future for Islamic banking in the country.
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