Interview with Mr. Kashif Manzoor Alvi, HR professional
Profile:
Mr. Kashif Manzoor Alvi is a PhD Scholar in Management Sciences with over 10 years of experience in various organisations. He is currently serving as HR professional at The University of Lahore, a leading Pakistani university, where he has been contributing for the last four years. Before this, he worked on multiple projects with NESPAK.
Pakistan & Gulf Economist had discussion with Mr. Kashif Manzoor Alvi about Islamic Financial System. The excerpts of the conversation are as follows:
The constitutional push to scrub interest (Riba) out of Pakistan’s financial system by 1st January 2028 is a big, bold statement. Through the 26th Amendment, the old vague line in Article 38 about eliminating Riba “as early as possible” got a hard deadline. That came after the Federal Shariat Court’s 2022 ruling that basically said the whole interest-based system doesn’t sit right with Islamic principles and gave the government until the end of 2027 to sort it out.
My take? It’s a genuine expression of what a large part of the country wants banking that feels cleaner and more aligned with faith. At the same time, turning that into reality in less than two years from now is not going to be easy. Government debt, international loans, foreign owned banks some of which apparently get more breathing room, and the simple fact that modern economies run on interest linked instruments make a clean switch extremely hard. You can change the labels and the contracts, but the economic substance risk, return, liquidity still has to work. If, it’s done carefully and gradually, it can deepen the existing Islamic banking momentum. If it’s rushed or half-hearted, you risk confusion, higher costs, and capital flight. So I’m cautiously respectful of the intent, but I’m watching the practical execution with raised eyebrows.
Islamic banking already holding over 25% of industry deposits, closer to 28% by the end of 2025, and still climbing, is no small thing. That’s real market preference speaking. People are voting with their money for products they feel better about. The growth has been strong for years, with assets and deposits both expanding faster than the conventional side, and the State Bank has been supportive with regulations and conversion incentives.
My standpoint is pretty straightforward, if customers want it and the banks can deliver competitive, properly supervised products, then great. Competition is healthy. It also creates a ready-made platform for the bigger Riba-free transition. That said, size alone doesn’t automatically mean everything is perfectly Shariah compliant in spirit as well as form. Some products still look a lot like conventional ones with extra paperwork. As long as the Shariah boards stay rigorous and the sector keeps innovating rather than just re-labelling, the 25%+ share is a positive development worth building on.
Shariah compliant solutions basically try to replace pure interest with real economic activity, risk sharing, or asset backed deals.
On the personal side, you see things like:
– Murabaha (bank buys the thing you want and sells it to you at a marked-up price on deferred payment)
– Ijarah (leasing you to use the asset and pay rent; ownership can transfer later)
– Diminishing Musharakah (especially for home finance you and the bank co-own, you gradually buy out the bank’s share while paying rent on the remaining portion)
– Personal financing structured around services or commodities so it doesn’t look like a pure cash loan with interest.
On the bigger end, corporate Sukuk are the star. Instead of a company borrowing money and paying interest, it sells certificates that represent ownership in a real asset or project (or a usufruct). Investors get a share of the actual returns or rental income from that asset. Governments and big corporates in Pakistan have already issued quite a few of these. You also get Musharakah and Mudarabah partnerships where profit and loss are genuinely shared according to agreed ratios.
The common thread is that money itself isn’t supposed to generate more money just by sitting there; there has to be an underlying trade, lease, or partnership. When done properly, it can feel more ethical to many people. When done poorly, it can end up more expensive and complicated than a plain vanilla loan.
Integrating Islamic economic principles into the wider Pakistani economy is the long game behind the 2028 deadline. The framework so far is a mix of court rulings, constitutional amendment, State Bank guidelines, mandatory Shariah boards in Islamic banks, conversion of conventional branches, and growing Sukuk markets. The idea is to move from a dual system (conventional + Islamic) toward a predominantly or fully interest free one.
The direction matches the country’s religious and cultural identity for a lot of people, and the rapid growth of Islamic banking shows demand is real. But a full-economy shift is a different beast from growing one segment of banking. You’ll still need deep, liquid markets for Sukuk and other instruments, ways to handle government financing without interest, solutions for trade finance and foreign investment, and honest answers about whether risk-sharing actually happens or whether most deals stay debt-like under a different name.
If the process stays transparent, gradual where necessary, and focused on genuine economic substance rather than just legal form, it can strengthen financial inclusion and public trust. If it becomes more about ticking boxes under political pressure, the economy could pay a price in higher costs and reduced flexibility. Pakistan has been talking about this for decades; the 2028 clock makes it real. Whether it becomes a success story or another unfinished reform will depend on how honestly the hard practical questions are faced in the next year and a half.