The Pakistan Stock Exchange (PSX) and Meezan Bank Limited signed an Agreement to provide a dedicated Shariah-compliant trading platform to Roshan Digital Account (RDA) clients. This will also facilitate investors focused on investing in shariah-approved securities.
The agreement was signed by the Managing Director (MD) and Chief Executive Officer (CEO) of PSX, Farrukh H. Khan, and the Founding President & CEO of Meezan Bank, Irfan Siddiqui, in the presence of the Chairperson of PSX, Dr. Shamshad Akhtar, and the senior management of both organizations.
This trading platform will be available through the online trading system provided by the PSX, called the Karachi Internet Trading System (KiTS). Any RDA client of an Islamic bank can avail of this platform to invest in the PSX through the services offered by more than 100 securities brokers using KiTS as an Order Management System (OMS).
The purpose of the platform is to enable Non-Resident Pakistanis (NRPs) to invest securely in their homeland’s capital market in a Shariah-compliant manner. Moreover, with this development in KiTS, Shariah-compliant investing capability can be offered virtually by many TREC-Holders to their RDA customers, thus providing clients with a broader suite of securities brokers to select from for their Shariah-compliant investment needs.
The criteria for investing in the Shariah-compliant platform have been developed by Meezan Bank and vetted by the PSX Shariah Advisor. The specifications of the Shariah-compliant trading platform include investing in KMI-All Share securities, Shariah-compliant initial public offerings (IPOs), and Shariah-compliant exchange-traded funds (ETFs). The trading option is available only for Ready and Odd Lot markets. The recently bought shares can be sold on a T+2 basis when credit default swap (CDS) shares purchased are available in the CDS account.
Speaking at the launch of the Shariah-compliant trading platform for RDA clients, the MD PSX stated that the “PSX is at the forefront of using technology to enhance the experience of market participants including investors. The demand for Shariah-compliant offerings is consistently rising and PSX has continued to grow its suite of Islamic capital market products. In recognition of this, PSX won the Best Islamic Stock Exchange award by Global Islamic Awards (GIFA).”
“This new and innovative platform offered by PSX to facilitate NRPs interested in investing in Shariah-compliant securities in a Shariah-compliant manner through the RDA platform is another example that PSX is fully cognizant of the interests and demands of market participants,” he continued.
Khan added, “I congratulate Meezan Bank and the PSX teams on this achievement to enhance investor experience and choice. I would especially like to appreciate Zahid Latif Khan (ZLK) Securities for being the first brokerage house to integrate and enable this offering for their RDA clients. I hope that this will generate interest and confidence among NRPs to securely invest in the capital market in a Shariah-compliant manner. With this development in KiTS, all TREC-Holders can now offer shariah-compliant products to RDA clients, creating new business opportunities for them.”
The Founding President & CEO of Meezan Bank said, “Meezan Bank is leading the industry with the highest share in RDA accounts and investment in the equity market. The bank’s advisory role in the extension of this service aims to improve the transparency and compliance of this solution with shariah principles.”
“The bank is already offering a Shariah-compliant trading platform for NRPs through 22 brokers who are on-boarded through their own systems. With the launch of this Shariah-compliant Trading Platform, brokers who are using KiTS will also be on-boarded with Meezan Bank to further extend these services to RDA customers. We are hopeful that this service will help tap into a wider RDA investor base that is seeking shariah permissible investment options,” he remarked.
Foundation Securities was the first Brokerage house to introduce Shahriah Stock Trading plateform “Shahriah Edge” and that was the first Shahriah stock Trading App in Pakistan till Far-East Asia region.