Pakistan Launches Capital Market Development Fund to Boost Investor Participation

Pakistan has launched a new industry-backed initiative, the Capital Market Development Fund (CMDF), with an initial investment of Rs. 120 million (Rs. 12 crore), aimed at expanding investor participation and promoting financial literacy across the country.

The fund has been established under the supervision of the Securities and Exchange Commission of Pakistan (SECP), with participation from key market institutions including the Pakistan Stock Exchange (PSX), Central Depository Company, National Clearing Company of Pakistan Limited, Pakistan Mercantile Exchange, and the Institute of Financial Markets of Pakistan.

Federal Finance Minister Muhammad Aurangzeb attended the signing ceremony in Islamabad and emphasized the importance of mobilizing domestic capital, especially in light of recent regional challenges.

He noted that strengthening local investment channels is essential for economic resilience and long-term growth.

SECP Chairman Dr. Kabir Ahmed Sidhu highlighted that investor participation in Pakistan’s capital markets remains below one percent of the population. Regulators are now targeting an increase to 2.5 million investors through reforms and improved accessibility.

Officials said onboarding processes are being simplified, while Know Your Customer (KYC) and Anti-Money Laundering (AML) frameworks are being streamlined to make it easier for retail investors to enter the market.

Recent data shows strong momentum in investor growth, with around 24,000 new investors entering the market in April 2026 alone. The CMDF aims to build on this trend by encouraging broader participation, particularly among youth and women.

According to officials, the CMDF will be supported by an initial Rs. 120 million contribution, with participating institutions committing one percent of their annual revenues to ensure long-term sustainability.

The initiative is expected to play a key role in deepening Pakistan’s capital markets and fostering a more inclusive financial ecosystem.

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