SECP’s Islamic financing facility centre inaugurated

ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) Chairman Zafar Hijazi on Thursday inaugurated an Islamic financing facility centre in Rawalpindi, which will help people to avail of affordable financing on Shariah principles to buy motorcycles and other products in due course of time, a statement said.

The centre will be operated initially by four modarabas, ie, Allied Rental Modaraba, First Habib Modaraba, Orix Modaraba and Trust Modaraba. They will provide microfinance to the customers at cheaper rate ranging in between 20 to 25 percent, as against the prevalent market rates of 40 to 45 percent.

Hijazi said that the SECP conducted a nationwide survey and it was found that illegal and unlicensed informal lending practices are being undertaken throughout the country at exorbitant rates by certain practitioners. He said no entity can undertake the business of micro-financing without getting licence from the SECP.

Realising the situation and to discourage the informal sector, the SECP advised the modaraba sector to setup a consumer financing centre in Rawalpindi to provide the public to avail of consumer finance in a regulated form at affordable rates, he added.

Hijazi said that the commission will not allow such unlicensed activities and action will be taken against those elements fleecing the people. Congratulating the modaraba sector on opening the centre in Rawalpindi, he advised it to setup such centres in other areas of the country where people can have easy access to financing facility.

Trust Modaraba CEO Basheer A Chowdry said that the Islamic financing facility will be run through reputable Qazi Trading Company, which will provide motorcycles to the applicants fulfilling the necessary requirement and modarabas will be providing loan facility for other market products also.