Islamic banking, with the help of coordinated efforts, will achieve its target of 20% share in the overall banking industry by 2020, said “Committee for Media Campaign” Chairman Irfan Siddiqui.
He praised the central bank’s efforts in launching the second phase of the awareness campaign meant to promote Islamic banking in Pakistan.
The campaign entered its second stage after the successful completion of the opening phase that focused on developing awareness and improving visibility of Islamic banking in the country, State Bank of Pakistan (SBP) said in a press release.
Siddiqui suggested that specific workshops and training programmes should be designed for corporate customers, general public, scholars, government officials and judiciary to create awareness of the products and services offered by Islamic banks.
He emphasised the need to speed up work to establish the Center of Excellence on Islamic Finance in each province to cater to the increasing demand for Islamic banking professionals.
Islamic banking industry, which currently accounts for a 9.8% share in the banking sector, continued to grow as both assets and deposits increased during the second quarter of calendar year 2014, according to the latest publicly available data.
Assets of the Islamic banking industry reached Rs1.08 trillion in the quarter ending on June 30 compared to Rs1.01 trillion of the preceding quarter, according to Islamic Banking Bulletin for April-June quarter of CY14. The industry’s deposits increased to Rs932 billion during the quarter under review compared to Rs872 billion of the previous quarter.
On the contrary, the market share of Islamic banking industry’s deposits in the overall banking industry declined slightly to finish at 10.6% during the quarter ending June 2014.
“The extensive KAP [knowledge, attitude and practices] Study of the State Bank of Pakistan established the demand for Islamic banking at all level, but at the same time revealed the lack of awareness not only among ordinary people but even among qualified and educated groups,” the SBP’s Deputy Governor Saeed Ahmad said while launching the second phase of the media campaign.
“There is desire among consumer to know more about Islamic banking and address some crucial questions,” he added. The main theme of the campaign’s second phase is education and awareness of Islamic banking through which the people would be apprised of the basic principles of Islamic banking.
“This would further translate into growth of the industry,” he said.
Published in The Express Tribune, December 31st, 2014.