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The Securities and Exchange Commission of Pakistan (SECP) has approved the Capital Market Development Fund (CMDF) and its terms of reference to meet the urgent needs of the capital market.
The Fund will focus first on raising financial literacy and public awareness so that retail investors can learn how the market works and how to take part safely. This will open the door to formal finance to more people and solve the problem of small firms having sources of finance other than banks.
Market infrastructure firms will put skin in the game. The Pakistan Stock Exchange, the National Clearing Company, Central Depository Company, and Pakistan Mercantile Exchange will contribute thirty million rupees as seed capital. These institutions will also set aside one percent of their annual revenues to support the Fund programs.
The Institute of Financial Markets of Pakistan will manage the Fund. The work will be guided and overseen by a Steering Committee consisting of members representing IFMP, PSX, NCCPL, CDC, and PMEX. This governance system is meant to maintain the Fund’s concentration and responsibility.
The Fund was launched during a consultative workshop titled Unlocking Capital Market Potential for Banks. The Finance Minister, Senator Muhammad Aurangzeb, took part in the event on August 18, 2025. The workshop brought together regulators, banks, market operators, and other stakeholders to discuss how banks can help deepen the market.
Practically, the Fund will fund training for retail investors, support capacity building for market participants, and reach groups and regions that the market has not served well so far. The Fund is a step toward wider financial inclusion and toward new channels of market-based financing for businesses.
