International Confidence in Pakistan’s Economy Reflected in Mashreq Bank’s Entry, says Pakistan Banks Association (PBA)

The Pakistan Banks Association (PBA), on behalf of the banking sector, hosted a reception in Islamabad to commemorate the commercial launch of Mashreq’s full services digital retail bank in Pakistan, Mashreq Bank Pakistan. This marks the first full-scale international deployment of Mashreq’s award-winning digital banking platform outside the UAE and a pivotal milestone in Pakistan’s digital banking journey.

Mashreq is one of the leading financial institutions in the MENA region, with a strong presence in major financial centres of the world, and the launch of its digital retail bank in the country was celebrated as a proud occasion for Pakistan’s banking industry. Known for its digital-first approach, customer-centric solutions, and commitment to advancing financial inclusion, this launch marks an important milestone in further strengthening investor confidence and deepening international collaboration.

The reception was hosted in honour of the esteemed state guests His Excellency Abdul Aziz Al Ghurair, Chairman of Mashreq, Mr. Ahmed Abdelaal, Group Chief Executive Officer, and Mashreq’s global leadership team. On behalf of the banking sector, Mr. Zafar Masud, Chairman PBA, and foreign investors, Mr Yousaf Hussain, President of Overseas Investors Chamber of Commerce and Industry (OICCI), welcomed the distinguished dignitaries. Keynote speakers of the event included Mr Jameel Ahmad, Governor of the State Bank of Pakistan (SBP) and Mr Bilal Azhar Kayani, Minister of State for Finance and Railways. Eminent leaders from the government, financial sector and the business community were also present in attendance.

The occasion underscored the pivotal role of the banking industry in driving Pakistan’s economy. In 2024, banks paid Rs. 856 billion in income tax and over Rs. 1.5 trillion in total taxes. In the first half of 2025 alone, the sector recorded a fiscal contribution of 30% higher compared to the same period in 2024, reaffirming its position as a cornerstone of national revenue generation. Yet this contribution comes under exceptionally heavy taxation, with an effective tax rate ranging between 55% and 59%, making banking one of the most heavily taxed sectors not only in Pakistan but across the region. Between 2021 and 2024, taxes on the sector surged by an unprecedented 438%, placing Pakistani banks among the most heavily burdened in the world.

The industry continues to spearhead reforms in digitalisation, working closely with the SBP and relevant stakeholders to accelerate the shift towards a cashless economy. Initiatives such as cross-bank eKYC, the Financial Data Exchange, and fintech partnerships have already contributed to a sharp increase in women’s financial inclusion, rising from 14% in 2021 to 43% in 2023. Similarly, the 2.41 billion retail digital transactions recorded, valued at over Rs.   164 trillion in the recent quarter, are a clear testament to the industry’s commitment to further its contribution towards a documented economy.

Equally important is the sector’s commitment to social responsibility, which has grown into a defining pillar of its contribution to national progress. Over the past two years, Pakistani banks have actively engaged in initiatives that directly impact local communities, encompassing a range of areas, including education, healthcare, environmental sustainability, and disaster relief. In 2024 alone, the industry collectively contributed ~Rs.   5 billion to CSR activities, which is again the highest by industry in Pakistan, underscoring its resolve to go beyond financial services and create meaningful social value across the country.

The banking industry continues to be one of the most preferred sectors for foreign direct investment (FDI) in the country.  With the addition of players like Mashreq, PBA believes that this cross-sector momentum will be further accelerated manifold, as it brings global best practices, innovation, and healthy competition to the market.

The launch of Mashreq’s digital retail bank was also recognised as a reflection of the growing confidence of international investors in Pakistan. Mashreq’s growing presence is expected to enhance banking sector competitiveness, attract foreign direct investment, and support sustainable economic growth.

The event concluded with the PBA extending its deepest appreciation to the distinguished guests and affirming that Mashreq’s presence in Pakistan symbolises not only the strengthening of bilateral ties but also the promise of a more inclusive, innovative, and progressive financial future for Pakistan.