Islamic mutual funds cross Rs2tr

March 26, 2026 (MLN): Sharia-compliant mutual funds in Pakistan have reached a historic milestone, with total assets under management (AUM) exceeding Rs2 trillion for the first time, showing growing investor confidence in Islamic investment avenues.

Latest data released by Mutual Funds Association of Pakistan (MUFAP) shows that assets managed by Islamic fund managers climbed to Rs2.1tr by the end of February 2026, marked a significant increase from Rs1.7tr recorded in the corresponding period last year, according to Propakistani. 

The sharp rise emphasizes sustained momentum in the sector, which had already surpassed the Rs1tr threshold by the close of 2024.

The continued expansion highlights increasing preference for Shariah-compliant financial products among a broad base of investors.

Islamic mutual funds in Pakistan are structured across multiple categories, including open-ended funds, pension funds, and exchange-traded funds (ETFs).

These funds invest in diverse asset classes such as equities, money market instruments, and income-generating securities, offering options ranging from equity and income funds to low-risk money market products.

Market participants note that mutual funds are gaining traction among investors seeking relatively stable returns with moderate risk, positioning them as a key savings and investment vehicle in the country.

The broader mutual fund industry also posted notable growth. Total AUM across 24 asset management companies reached Rs4.35tr by February 2026. Conventional funds accounted for Rs2.25tr of this total, showing steady expansion alongside the Islamic segment.

Investor participation has also increased in related products, including voluntary pension schemes, employer-backed retirement plans, and ETFs, further supporting the sector’s upward trajectory.

Bank-sponsored asset management companies continue to maintain a dominant position in the market, leveraging extensive distribution networks and diversified investment platforms to attract a larger pool of investors.

Among leading players, Al Meezan Investment Management remained at the forefront with assets under management of Rs701bn. It was followed by NBP Fund Management (Rs551bn), MCB Investment Management (Rs421bn), UBL Fund Managers (Rs386bn), HBL Asset Management (Rs358bn), and Alfalah Asset Management (Rs335bn).

The continued rise in Sharia-compliant investments signals a structural shift in Pakistan’s financial landscape, with Islamic funds increasingly capturing a larger share of the country’s growing asset management industry.

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