In a landmark move for Pakistan’s financial sector, the Mutual Funds Association of Pakistan (MUFAP) has officially been registered as a Self-Regulatory Organization (SRO) under Section 36D of the Securities and Exchange Commission of Pakistan (SECP) Act. This designation makes MUFAP the first Section 42 company in the country to attain SRO status, a significant milestone that elevates the fund management and pension industry into a new phase of self-governance, accountability, and market discipline.
With its new role, MUFAP transitions from being solely a trade body to an empowered entity with regulatory responsibilities. The organization is now tasked with supporting oversight functions, ensuring adherence to ethical standards, and strengthening investor trust. This will be achieved through a well-structured system of inspections, compliance monitoring, dispute resolution, complaint handling, and investor education initiatives. The change is aimed at fostering industry discipline while promoting long-term development in Pakistan’s capital markets.
The decision was announced during MUFAP’s Board meeting on August 7, 2025, where both the Board and Management expressed deep appreciation to the SECP for its trust and continued guidance. MUFAP reaffirmed its readiness to take on these enhanced responsibilities through a phased implementation strategy that aligns with operational priorities. This approach is designed to ensure a smooth, resource-backed, and effective transition into its expanded mandate.
As part of its SRO functions, MUFAP will enforce a robust code of conduct for all regulated entities to maintain fair and transparent market practices. The association will conduct both on-site and off-site inspections to ensure compliance with rules, regulations, and disclosure standards. Additionally, MUFAP will introduce standardized templates for critical documentation such as trust deeds, offering documents, Key Fact Statements (KFS), and Fund Manager Reports (FMRs) in line with international best practices, thereby improving uniformity and clarity across the industry.
In the area of investor protection, MUFAP plans to establish efficient grievance redressal and arbitration mechanisms to resolve complaints transparently and swiftly. It will also spearhead public awareness campaigns, investor education programs, and digital outreach initiatives, with a focus on underserved segments like women and youth. By increasing financial literacy and market participation, MUFAP aims to broaden the investor base and strengthen confidence in Pakistan’s fund management ecosystem.
Beyond its regulatory role, MUFAP will actively contribute to industry growth by crafting policy proposals aimed at fostering innovation, streamlining processes, and encouraging sustainable expansion. Close collaboration with SECP will be essential in rolling out reforms that address emerging challenges while promoting market stability.
This development positions MUFAP as both an industry advocate and a frontline regulator with the ability to respond quickly and proportionately to evolving market needs. By balancing regulatory oversight with practical industry insight, MUFAP is expected to play a pivotal role in safeguarding investor interests, promoting market integrity, and accelerating the professionalization of Pakistan’s mutual fund and pension landscape. The move represents a significant step toward a more resilient, transparent, and inclusive financial system that aligns with SECP’s vision for the country’s capital markets.