BankIslami Launches Pakistan’s First Gold-Based Islamic Financing Facility.
✧ GENERATE BRIEFING +
BankIslami has introduced Pakistan’s first Shariah-compliant Gold-Based Financing facility, enabling retail and business customers to unlock liquidity by pledging gold ornaments while ensuring full asset security. Approved by the bank’s Shariah Board, the product is structured on Tawarruq—utilizing Shariah-compliant mutual fund units as the underlying asset—to provide a Halal alternative to conventional interest-based gold loans. Under the parameters of the facility, eligible individuals can secure financing ranging from Rs250,000 to Rs5 million, capped at up to 70% of the net value of the pledged gold. Repayment terms are structured flexibly between one to four years via monthly installments. The facility targets salaried professionals, self-employed persons, and business owners (subject to a minimum net disposable income threshold of Rs80,000 and an acceptable credit history) for verified personal requirements such as medical procedures, education, marriage expenses, and the settlement of conventional financial liabilities.
BankIslami has launched Pakistan’s first Shariah-compliant Gold-Based Financing facility, allowing customers to obtain financing against pledged gold while the bank keeps the gold in secure custody.
Under the facility, customers can obtain financing ranging from Rs250,000 to Rs5 million, with financing of up to 70% of the net value of the pledged gold. The repayment tenure ranges from one to four years.
The facility is available to salaried individuals, self-employed professionals and businesspersons, subject to income, credit-history and other eligibility requirements. Financing can be used for genuine personal needs including medical expenses, education, marriage-related costs and repayment of conventional liabilities.
BankIslami said the product is structured according to Islamic banking principles and approved by its Shariah Board. The bank’s current product documentation describes the financing structure as Tawarruq, using Shariah-compliant mutual fund units as the underlying asset.
The pledged gold is valued by bank-approved goldsmiths based on its net weight and purity, with a minimum purity requirement of 21 karat. The gold is sealed in tamper-proof bags, stored in secured vaults under dual-control arrangements and covered through Takaful during the financing period.
The launch expands BankIslami’s retail financing portfolio and provides customers with an alternative to conventional gold-backed loans. The bank said the initiative is aimed at expanding access to Islamic financial solutions and supporting financial inclusion.
