The Securities and Exchange Commission of Pakistan (SECP) has initiated a series of transformative steps aimed at modernizing and deepening Pakistan’s mutual funds industry. The wide-ranging reforms, introduced as part of a strategic regulatory shift, include the formal registration of the Mutual Funds Association of Pakistan (MUFAP) as a Self-Regulatory Organization (SRO), the rollout of a comprehensive Digital Asset Management Companies (Digital AMC) Framework, and the establishment of a dedicated committee to accelerate the growth of Exchange Traded Funds (ETFs).
These initiatives are part of SECP’s broader strategy to enhance market integrity, promote financial inclusion, improve investor confidence, and align the mutual fund industry with global standards. The goal is to create a more transparent, efficient, and digitally inclusive financial ecosystem that caters to both institutional and retail investors.
With MUFAP now officially recognized as an SRO, it assumes a pivotal role in regulating and advancing the mutual fund industry in Pakistan. MUFAP will be responsible for promoting ethical business conduct, fostering professional competence, conducting industry-level research, and guiding the development of standards consistent with international benchmarks. The organization will also arbitrate disputes, conduct compliance inspections, and drive investor education and outreach campaigns with a strong focus on protection and transparency.
MUFAP will further take charge of reviewing core industry documents, such as trust deeds and offering materials, and help standardize reporting and documentation. This structure aims to support the growth of a more resilient, investor-centric mutual fund ecosystem capable of attracting broader participation and investment.
The introduction of the Digital AMC Framework represents another cornerstone of SECP’s reform agenda. This framework is designed to catalyze innovation within the asset management space by reducing entry barriers for new players, encouraging digital onboarding, and offering end-to-end online access to mutual fund investments. The move is expected to drive retail participation and open up mutual fund products to a wider demographic, particularly through smartphones and fintech platforms.
In parallel, SECP has constituted a specialized committee tasked with reviewing the current state of ETFs in Pakistan. The committee will examine international best practices and recommend actionable reforms to eliminate inefficiencies and increase adoption. By improving regulatory clarity and reducing friction in ETF investment processes, the SECP hopes to broaden the country’s capital market offerings and appeal to both domestic and foreign investors.
To further engage stakeholders, SECP recently hosted a Mutual Funds Industry Focus Group Session. The event convened fund managers, financial experts, and industry stakeholders to identify strategic priorities. Key discussion points included infrastructure finance through mutual funds, modernizing distribution models, enhancing liquidity governance, and addressing structural challenges limiting women’s financial inclusion. The promotion of Systematic Investment Plans (SIPs) as a disciplined, long-term savings tool was also strongly encouraged.
Following the session, a White Paper summarizing key takeaways and action points was approved by the SECP and is being circulated for broader implementation. The document outlines a future roadmap aimed at positioning Pakistan’s mutual funds industry as a robust, investor-aligned, and digitally agile segment of the financial ecosystem.
These strategic reforms mark a defining moment for Pakistan’s asset management industry, setting a new course toward innovation, compliance, and financial empowerment.