Page 16 - CMA Journal (Mar-Apr 2025)

Exclusive Interview

The bank has embedded Shariah compliance into its
operations by revamping systems, processes, and Legal reforms are essential to ensure
documentation, alongside extensive employee training
in Islamic banking practices. A specialized Shariah Islamic banking is seamlessly
Compliance Department continuously monitors
operations, conducts audits, and provides guidance to integrated into the country’s financial
maintain alignment. This disciplined approach has laws, along with developing
helped Faysal Bank not only achieve full compliance but
also build customer trust and credibility as a leading specialized regulatory frameworks
Islamic financial institution. under the State Bank of Pakistan
ICMA: In your view, what policy or regulatory support
is most needed to promote Islamic banking in
Pakistan? overall banking industry significantly by 2028, as more
institutions convert and new entrants emerge.
Yousaf Hussain: To further promote Islamic banking in Innovations in digital banking, product development,
Pakistan, the most critical policy and regulatory support and customer experience tailored to Islamic principles
needed includes harmonizing Shariah standards across will further accelerate this momentum. Institutions like
institutions, simplifying conversion processes for Faysal Bank, with their successful transformation, are
conventional banks, and expanding Shariah-compliant setting benchmarks that will inspire broader systemic
liquidity tools. Legal reforms are essential to ensure change and contribute to building a fully Riba-free
Islamic banking is seamlessly integrated into the economy.
country’s financial laws, along with developing
ICMA: As President of OICCI, how do you see its role
specialized regulatory frameworks under the State Bank
of Pakistan. Capacity building is also vital—through in supporting foreign investment and promoting
education, training, and certification programs—to Islamic finance in Pakistan?
address the scarcity of skilled Islamic finance Yousaf Hussain: As President of OICCI, my role in
professionals. Additionally, raising public awareness supporting foreign investment is fundamentally rooted
about the value and principles of Islamic banking will in creating a conducive environment for both local and
help drive demand and foster broader financial inclusion. international investors. The key is to establish a business
ecosystem that fosters growth, stability, and
ICMA: How can Islamic banking contribute to
transparency. By advocating for streamlined regulations,
financial inclusion and support for SMEs in the
country? tax incentives, and policies that align with global
standards, we can create an attractive investment
Yousaf Hussain: Islamic banking can significantly climate in Pakistan. Our focus is to promote foreign direct
contribute to financial inclusion and SME support by investment (FDI) as a cornerstone for Pakistan's
offering Shariah-compliant products that emphasize economic development, as it brings not only capital but
risk-sharing, asset-based financing, and ethical also technology, expertise, and job opportunities.
investment. Unlike conventional lending, Islamic finance
Regarding Islamic finance, it is an essential tool for
structures such as Mudarabah (profit-sharing) and
Musharakah (joint venture partnerships) are well-suited financial inclusion and diversification. However, I view it
for SMEs that need flexible and partnership-driven not as an end in itself, but as a means to an end. It can
serve as a valuable mechanism for our members to
funding. Islamic banks can tap into underserved
segments, including individuals and businesses hesitant access financing that aligns with ethical and
Sharia-compliant principles. By integrating into the
to engage with interest-based systems, thus broadening
the customer base. By fostering entrepreneurship, broader strategy that OICCI is working towards, our
providing tailored financing solutions, and promoting members can leverage Islamic finance solutions to
achieve sustainable growth, enhance access to capital,
equitable economic participation, Islamic banking plays
a crucial role in empowering SMEs and driving inclusive and expand opportunities for businesses.
economic growth. In summary, OICCI's role is to support foreign investment
in all its forms, including in Islamic finance, as part of a
ICMA: What is your outlook on the future of Islamic
finance in Pakistan? broader strategy to enhance economic development,
create jobs, and build a stronger, more diversified
Yousaf Hussain: The future of Islamic finance in Pakistan business ecosystem in Pakistan.
is highly promising. With strong regulatory support, clear
judicial directives to eliminate Riba, and increasing The Editorial Board thanks Mr. Yousaf Hussain, President & CEO,
public preference for Shariah-compliant financial Faysal Bank Limited for sparing from his precious time to give
solutions, Islamic banking is positioned for robust exclusive interview for Chartered Management Accountant Journal.
growth. The sector is expected to expand its share of the

14 ICMA’s Chartered Management Accountant, Mar-Apr 2025