Islamic banking in Pakistan – Problems and prospects

This research paper suggests that Islamic Banking is spreading its wings in Pakistan and is positioning for growth. Islamic banking in Pakistan is also facing some challenges owing to the fact that conventional banking in the country is more penetrative and holding larger share in the economy.

A qualitative study was made through sending questionnaire to 15 banking and non banking professional of our network holding middle to top management positions in their work place. Also, six in-depth interviews were also carried out during the months of July -August, 2010. Three interviews were made from Islamic bankers, holding middle management positions in three different Islamic banks and three detailed interviewed were made from customers of those three different banks. Questions asked during interview were based on basics of Islamic banking, challenges faced, distinguishing feature, comparison with conventional banking, product and market development, challenges faced and future growth.

Through both ways of qualitative research (i.e. questionnaire and detailed interview) it is extracted that Islamic banking in Pakistan is positioned for growth, since Muslim community in our society is eager to know more about it and want to spend their lives in the light of Islamic preaching and fundamentals of religion. Need is however, felt to arrange a platform to increase and share the knowledge base in our country, increase awareness, introduced new products as per the need and requirement of the society, introduce courses and programs in all colleges, Universities, and Business Schools to familiar students about Islamic banking so that their learning curve built before they enter in job market and finally improve quality of the human resources particularly those working in Islamic Banks.