KARACHI: Mobilink Bank is looking to deepen its footprint in Pakistan and boost its portfolio of Sharia-compliant products as the country accelerates efforts to shift to Islamic finance.
Mobilink has already begun building the core infrastructure for its Islamic banking platform and has set up two Islamic banking windows, in Karachi and Peshawar, with plans to scale nationwide and launch a digital Islamic portfolio, Haaris Mahmood Chaudhary, the bank’s chief executive officer, told The News in an interview.
“Our growth strategy is centred on expanding the digital ecosystem to make Sharia-compliant financial services more accessible and relevant for underserved segments,” Chaudhary said.
“We see significant opportunities in facilitating small businesses through Islamic digital banking, delivering Sharia-compliant financing via digital channels and partner ecosystems,” he said.
“Our focus will be on small business financing, value chain financing, digital agri-finance and digital home financing,” he added.
The bank also aims to strengthen its portfolio of Sharia-compliant products through models such as musharakah (partnership-based financing), murabaha (asset sale transaction), and agri-based Salam, ensuring customers have access to Islamic financial solutions and accelerating financial inclusion.
Islamic banking has been growing rapidly in Pakistan, the world’s second most populous Muslim country. The assets are projected to reach Rs18-19 trillion by December 2026, compared with Rs14.47 trillion a year earlier. Lenders are required to convert to interest-free Islamic banking by December 2027. According to the central bank, all new domestic loans issued from January 1, 2028, will need to be Sharia-compliant.
Chaudhary, a seasoned banking professional specialising in financial inclusion and digital banking, believes that the shift toward Islamic finance presents a significant opportunity to increase access to Sharia-compliant financial services. However, this transition depends heavily on technology readiness. Most banks rely on third-party core banking platforms, making the development and deployment of automated Sharia-compliant systems a real challenge.
Mobilink Bank has made significant strides in its journey towards inclusive, digital-first banking by launching its Islamic banking operations in December last year. In January 2026, the VEON Group invested $20 million in the bank, which strengthened its ability to accelerate its growth strategy. This includes building digital banking capabilities, expanding its Islamic digital banking offerings, scaling small-business financing, and upgrading the technology needed for a seamless customer experience. The investment has also strengthened the bank’s capital base, supporting sustainable growth while maintaining financial resilience. As a result, the bank delivered Rs78.7 billion in revenue in 2025, with lending and deposits both growing 38 per cent, and a capital adequacy ratio of 19.5 per cent.
The government has cut international transaction taxes from 5.0 per cent to 0.5 per cent — a 90 per cent reduction — while introducing a 10 per cent tax credit for digital system integration, directly lowering operational and technology costs, Chaudhary said.
He noted that the budget allocates Rs298 billion for small business and agricultural lending at reduced markup rates, creating strong demand for microfinance services across underserved rural and small business segments. The digital payment ecosystem is also strengthening, with annual digital transactions growing from 6.9 billion to 10.1 billion and 92 per cent of remittances now flowing through banking channels.
The future of SME finance is in creating comprehensive business ecosystems rather than providing isolated loans
In response to a question about the ongoing financing gaps faced by SMEs, particularly women-led and informal businesses, he stated that closing this gap means moving beyond collateral-based lending toward cash-flow and data-driven credit assessment. A recent Malaysian study found that adding bank transaction data to credit scoring lifted predictive accuracy by nearly a quarter, showing what alternative data can do for SMEs invisible to conventional underwriting.
“At Mobilink Bank, our Bint-e-Hawa Business Loan reflects this thinking for women entrepreneurs and sits within a broader Women Financial Services Strategy; we are also a signatory to the WE Finance Code, which commits us to designing products around women’s actual barriers,” Chaudhary said.
“We are building supplier financing to unlock working capital for businesses with strong fundamentals but limited collateral and exploring AI-powered credit scoring models that draw on non-financial metrics, such as transaction history, mobile usage patterns, and business performance, to assess creditworthiness beyond traditional collateral requirements,” he added.
The bank’s CEO believes that the future of SME finance lies in building end-to-end business ecosystems rather than offering standalone loans, with financial institutions evolving into platforms supporting the entire business lifecycle, such as digital payments, invoicing, bookkeeping, inventory management, and cash-flow tracking within a single digital experience. Such an ecosystem strengthens enterprise resilience while generating transactional data that helps informal businesses gradually transition into the formal economy.
According to Chaudhary, AI is not a strategy in itself; it is a powerful tool for processing large data volumes, enabling fraud detection, and scaling operations that serve millions of customers daily. What matters is responsible deployment, with data security, governance, and compliance at the core.
“We have set up an in-house AI Council to evaluate, deploy and govern AI use cases responsibly, spanning credit scoring models and both consumer-facing and enterprise-level applications,” he said.
“The ‘phygital’ model resonates strongly with us; customers still value the trust of physical branches yet demand seamless digital experiences. Our customers can now invest in T-bills through the JazzCash app, accessing government securities digitally for as low as Rs5,000, without opening an investor portfolio securities account,” he added.
“We are also seeing exciting possibilities in digital assets, particularly with the entry of players like Binance into the market. As regulation matures, the banks that succeed will be those able to plug fintechs and platforms seamlessly into their infrastructure and bring value-added services to their customers.”
