Pakistan's SECP Streamlines Capital Market Entry with Digital Framework

The Securities and Exchange Commission of Pakistan (SECP) has introduced a unified digital investor onboarding framework designed to make entering the country's capital market significantly faster and easier. This new system aims to reduce repetitive verification processes, simplify necessary documentation, and establish clear timelines for opening investor accounts.

Specifically targeting first-time and digital investors, the framework introduces 'Sehl/Sahulat' accounts, which are promised to be processed within a single working day. Standard accounts will be processed within two working days. According to an SECP statement, applicants will receive tracking IDs, and any deficiencies or reasons for rejection will be communicated in writing within the prescribed timeframe.

This initiative is a key component of the SECP's broader strategy to expand retail participation in the capital market, with a particular focus on engaging young Pakistanis. The ultimate goal is to increase the country's capital market investor base to 2.5 million individuals. SECP Chairman Dr. Kabir Ahmed Sidhu emphasized the focus on removing entry barriers and leveraging technology to create a simpler, faster, and more accessible investor journey.

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Our focus is to remove entry barriers and use technology to make the investor journey simpler, faster and more accessible.

"The objective is to unlock the significant untapped potential of Pakistan’s capital market by broadening participation, particularly among the youth, and building a deeper and more inclusive market," Sidhu elaborated. The framework standardizes onboarding requirements across various financial intermediaries, including securities brokers, asset management companies, and insurers, ensuring a more consistent investor experience throughout the regulated financial sector.

A notable feature of the framework is the elimination of redundant customer verification. If verification has already been completed by a recognized financial institution or third party, intermediaries can rely on that existing verification. The system also enables API-based straight-through processing and digital onboarding, including instant issuance of Unique Identification Numbers (UINs) and the opening of Central Depository Company (CDC) sub-accounts, thereby minimizing paperwork and manual intervention.

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The objective is to unlock the significant untapped potential of Pakistan’s capital market by broadening participation, particularly among the youth, and building a deeper and more inclusive market.