Professional Documents
Culture Documents
Pakistan
M.Sh eh ar yar Ka ne ez
Um br ee n
Baig Fa ti ma
Ak ht er
MIF-17 MIF-2 1
Scope of Presentation
Consumer Financing: Overview
Growth of Consumer Financing in
Pakistan
Categories
Some Charts
Regulatory Framework for Consumer
Financing
Shariah Compliant Models of Consumer
Financing
Issues and Challenges from Consumer
Perspective
Social & Economic Impacts of Consumer
Kaneez Fatima
MIF-21
Consumer Financing: Overview
Personal Loans
Auto Finance
Housing Finance
Credit Cards
Personal Loans
“Loans provided to
individuals for the
payment of goods,
services and
expenses”
Supplemantory card
Women card
Student card
Banks are making abnormal profits after the emergence of
consumer financing.
Umbreen Akhter
MIF-23
Regulatory frame work
In Pakistan State Bank of Pakistan is the
regulatory authority of all banks and Development
Finance Institutions (DFIs)
Regulatory Framework for Consumer
Financing
Statement of accounts
Hypothecation of vehicles
Contd….
Insurance
Repossession of vehicles
Repayment schedule
Debt-equity ratio.
Mortgage.
Contd….
Evaluation of property
Murabaha
Ijara Muntahia Bittamleek
Istisna
Diminishing Musharaka
Housing Finance Arrangements
1. Murabaha Based Housing
Car Financing
Car Leasing
Auto Loans
Car Financing
“Providing loan to the customer for purchase
of a car”
Car Leasing
“Car remains in the ownership of financier and
customer pays the rental charges to financier
till the end of the term”
. .
VENDOR ISLAMIC BANK Agreeme CUSTOMER
nt-2
Credit Cards
Debit Cards
ATM Cards
Charge Cards
Cards
Credit Card
Allowed in following situations
• Traveling abroad or out of city where cash
may not be carried
• Payment on internet
• Purchasing valuables
• Extreme emergency
• Iztirar (Compulsion)
Cards
Debit Cards
ATM Cards
Charge Cards
Purchase of Assets
Payment of Expenditures
Personal Loans
Purchase of Assets
Increased dependence on
foreign loans
Lack of infrastructure to
absorb and manage the
increased number of cars
on the road due to easy
auto financing
Contd…
Spending beyond their means behavior results in
burdening the economy and society
9. Unsolicited Financing
Aggressive marketing campaigns launched by the banks are
targeting the costumers and encouraging them to purchase a loan
or credit.