1,396 ‘suspicious remittances’ received in five years

Senate body debates shift towards Islamic banking

ISLAMABAD:

The Senate Standing Committee on Finance on Wednesday was informed that 1,396 reports of “suspicious remittances” were received in the last five years.

The meeting of the panel was held in Islamabad under the chairmanship of Senator Saleem Mandviwalla.

While giving a briefing to the participants of the meeting, the FBR officials told the committee that from 2017 to 2022, 1,396 reports of suspicious remittances were received.

They added that in the last five years, action was taken against 496 cases of money laundering.

They said 150 of such cases were  dealt with under the Anti-Money Laundering Act.

The officials further told the committee that under the same Act, action was taken over 227 tax evasion cases and 119 were disposed of.

The committee asked for in-camera details on money laundering cases.

Minister of State for Finance Ayesha Ghous Pasha gave a briefing on withdrawing the appeal against the interest-free banking decision of the Federal Shariat Court (FSC).

PPP Senator Sherry Rehman wondered whether or not it was the right time to discuss interest-free banking given the economic challenges the country was facing.

“What are the strategic benefits of interest-free banking to Pakistan?” she asked.

State Bank of Pakistan (SBP) officials said that it took five years for some banks to convert from conventional banking to the Islamic one.

The committee’s chairman asked why the SBP had first appealed against the decision and then withdrew it later.

The SBP officials replied that it was a commitment that they would move towards Islamic banking.

An appeal against this decision was made to seek more time, they added.

PTI Senator Mohsin Aziz noted that the new branches of banks should only have Islamic services available.

“It is inappropriate to do Islamic banking at 20% interest rate,” he said, adding that it was better to let the interest continue.

Senator Shaukat Tarin, also of the PTI, said many countries, including Malaysia and Bahrain, had switched to Islamic banking.

“If we want to move towards Islamic banking, concrete steps have to be taken,” he added.

“If we do not come up with a solid alternative system, international investors and companies will not be able to operate [in our country],” he pointed out.

He added that politics should not be considered in this work.

The SBP officials said that the opinion of Sharia scholars should also be sought for Islamic banking.

Ayesha said that many investors wanted to opt for Islamic banking.

“Due to our religious beliefs, we must go for Islamic banking,” she added.

She further said that it would take time to adopt the Islamic banking system.

Tarin said digital banking would increase tremendously in the future and it should be kept in mind.

“Islamic banking should be expanded step by step,” he added.