The Securities and Exchange Commission of Pakistan (SECP) has launched a transformative Digital Asset Management Companies (AMC) framework, marking a major step in the modernization of the country’s mutual fund industry. This strategic reform package is designed to enhance accessibility, encourage innovation, and bring new levels of efficiency and transparency to the asset management sector.
As part of this initiative, the Digital AMC framework introduces a series of measures aimed at lowering entry barriers for new market participants. These include reduced minimum equity and fund size requirements, along with provisions for fully digital investor onboarding and operations. The move signals a major opportunity for fintechs and technology-driven players to enter and scale within the asset management space, offering investors seamless, digital-first investment solutions.
The SECP’s push toward digital transformation is aligned with its broader vision to expand financial inclusion and modernize Pakistan’s capital market ecosystem. By promoting simplified processes and lowering regulatory thresholds, the framework allows more agile and tech-savvy firms to deliver investment products tailored to the evolving needs of both institutional and retail investors.
In another landmark development, the SECP has officially recognized the Mutual Funds Association of Pakistan (MUFAP) as a Self-Regulatory Organization (SRO) under the SECP Act, 1997. This designation, the first of its kind within Pakistan’s financial services industry, grants MUFAP enhanced responsibilities including regulatory oversight, monitoring member compliance, and spearheading investor education initiatives. This move is expected to create stronger industry governance and instill greater investor trust through independent oversight mechanisms.
The SECP has also collaborated with key market stakeholders to develop a forward-looking white paper that outlines strategic goals and sector-wide priorities. This includes the promotion of digital platforms, development of Exchange Traded Funds (ETFs), and the introduction of Environmental, Social, and Governance (ESG)-linked investment products. Additionally, the white paper proposes launching infrastructure funds and devising targeted measures to expand financial inclusion across diverse demographic segments.
The white paper is now publicly accessible on SECP’s official website, providing transparency and inviting feedback from market participants and the public at large. It is envisioned as a blueprint for the future evolution of Pakistan’s mutual fund landscape, focused on market deepening and investor-centric innovation.
To further support the ETF ecosystem, the SECP has constituted a specialized committee dedicated to advancing ETF development. The committee will be responsible for identifying structural challenges, facilitating investor participation, and enabling the launch of ETF products that cater to local investment trends. This initiative is expected to unlock new asset classes and promote liquidity in the secondary market.
Through the introduction of the Digital AMC framework and allied reforms, the SECP aims to position Pakistan as a progressive, digitally enabled financial market. The shift not only supports innovation but also strengthens the regulatory infrastructure needed to ensure resilience, efficiency, and growth in the mutual funds industry.