Pakistan’s Islamic banking industry is expected to maintain strong growth momentum, with total assets projected to reach Rs18–19 trillion by December 2026.
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Industry experts shared the projections during a media briefing hosted by Meezan Bank in Karachi.
According to the estimates, Islamic banking assets stood at Rs14.47 trillion by December 2025.
Deposits and Financing Portfolio Expected to Rise
Officials projected that Islamic banking deposits will increase to Rs13.5–14.5 trillion by December 2026, compared with Rs11.04 trillion in December 2025.
Meanwhile, the sector’s share in total banking assets is expected to rise to 25–27 percent by the end of 2026.
Its share in total banking deposits may also increase to 30–32 percent during the same period.
Experts further projected that the Islamic financing portfolio will grow to Rs7.0–7.8 trillion by December 2026, up from Rs5.65 trillion in December 2025.
The increase reflects rising demand for Shariah-compliant financing across consumer, SME, agriculture, corporate, and government-linked sectors.
Meezan Bank Officials Discuss Industry Outlook
The briefing featured Ahmed Ali Siddiqui, Farhan Ul Haq Usmani, and Muhammad Raza.
The speakers discussed market performance, regulatory developments, and the future outlook of Islamic banking in Pakistan.
They said the sector continues to expand because of rising customer preference, regulatory support, branch expansion, and increased Sukuk activity.
Islamic Banking Sees Rapid Expansion
According to the briefing, Islamic banking assets increased from Rs5.27 trillion in December 2021 to Rs14.47 trillion by December 2025.
Similarly, deposits rose from Rs3.62 trillion to Rs11.04 trillion during the same period.
The Islamic financing portfolio also expanded from Rs2.35 trillion in 2021 to Rs5.65 trillion by the end of 2025.
Officials noted that Islamic banking assets grew by 23.1 percent in CY24 and 30.7 percent in CY25.
They attributed the growth to strong customer confidence in Shariah-compliant banking products and services.
Branch Expansion and Digital Banking to Drive Growth
The Islamic banking branch network is projected to expand to 7,300–7,800 branches by December 2026.
Currently, the sector operates more than 6,700 branches nationwide.
Experts also highlighted the growing role of digital banking channels in improving financial inclusion and access to Islamic financial services.
Pakistan Targets Broader Islamic Banking Transition
Industry participants believe Pakistan’s transition toward a Riba-free banking system by 2027–2028 will further accelerate sector growth.
They said both full-fledged Islamic banks and conventional banks with Islamic banking windows are expanding their product offerings and customer outreach.
In addition, large sovereign Islamic financing requirements and Sukuk issuances continue to strengthen Pakistan’s Islamic finance ecosystem.
Experts projected that Islamic banking assets could exceed Rs25 trillion by 2028 if the current growth trend continues.
They added that Pakistan may further strengthen its position among the world’s fastest-growing Islamic banking markets.
