Author: Raja Ali

MUFAP and CDC-ITMinds Limited sign MoU for Mutual Fund Digital Platform

Mutual Funds Association of Pakistan (MUFAP) and Central Depository Company of Pakistan Limited (through its subsidiary ITMinds Limited) signed a Memorandum of Understanding for the development and implementation of a digital platform for the support of the Mutual Fund industry. Mr. Aamir Khan, Chairman – Securities and Exchange Commission of Pakistan (SECP) presided at the MoU Signing Ceremony at the CDC House, Karachi.

At the occasion, describing the features of the platform, CEO-CDC Mr. Badiuddin Akber said that “This FinTech solution aims to enhance the investor outreach for Asset Management Companies (AMCs) by leveraging the power of technology to provide a convenient, informative and interactive medium for investors to invest in a wide range of investment products offered by different mutual funds.”

Dr. Amjad Waheed, Chairman MUFAP applauded the efforts of CDC and SECP and said that this initiative will pave the way for the growth of the Mutual Fund Industry.

While addressing the occasion, Chairman SECP – Mr. Aamir Khan said that “The initiative is in line with SECP’s highly recommended course of action for the mutual fund industry which advocates the development of alternate distribution channels and digital platforms. The recent circumstances induced by the pandemic make it all the more exigent for AMCs to undergo complete digital transformation. This platform will facilitate investors from specific market segments and low risk investors, thus promoting financial inclusion at the grass root level and harvesting the savings culture in Pakistan.”

He said the pivotal role of innovation in economic development is undeniable, with advancements in Fintech leading the change. Innovative tech-based processes can lead to higher productivity, reduced turnaround times, lower costs and wider outreach.

He said the first cohort of the Regulatory Sandbox launched by SECP received an overwhelming response from the market, and a number of innovative ideas and solutions that were received, related to digital distribution, Robo Advisory and digital intermediation. There is a clear indication that the market is ripe for adoption of digital solutions and both SECP and MUFAP have jointly employed a focused approach to harness this potential through streamlining regulatory processes. However, this development must be viewed in the backdrop of some worrying statistics.

He said Pakistan’s mutual fund segment stands at a meager 1.6 percent of the GDP, which is very low compared to the market’s potential. A major obstacle in moving the needle has been limited outreach and focus on specific market segments. While this ‘Digital Platform’ will be provide a low-cost and centralized solution to investors, initially through covering low-risk investors in the first phase, it must quickly be expanded to a full-fledged distribution mechanism for all investors.

The audience was also addressed by Mr. Farrukh Sabzwari, Commissioner Specialized Companies Division – SECP, Ms. Khalida Habib, Executive Director – Specialized Companies Division – SECP and Chairman CDC – Moin Fudda. The event was attended by the senior management of AMCs and other high ranking officials of the industry.

CDC to facilitate investment in Pakistan Stock Market by Non Resident Pakistanis (NRPs) through Roshan Digital Account

Central Depository Company of Pakistan Limited (CDC) to facilitate investment by Non-Resident Pakistanis in the Pakistan Stock Market through Roshan Digital Account with designated large-scale banks” said Mr. Badiuddin Akber, CEO-CDC.

He further stated that Roshan Digital Account is a remarkable step taken by the State Bank of Pakistan to facilitate Overseas Pakistanis. Similarly, allowing NRPs to invest in Stock Market through Roshan Digital Account is a further facilitation for NRPs which is the result of SECP’s vision to create ease of doing business for investors. He applauded the collaborative efforts of both SECP and SBP through which this important milestone was achieved.

Through this initiative, NRPs desirous of investing in the Stock Market of Pakistan will be able to do so through an efficient, secure and convenient mechanism. Since there is no additional requirement other than having a Roshan Digital Account for NRP to start investing in Stock market, they just need to provide consent to their respective Bank to link them with CDC. Within the next 24 hours, they will be able to trade without the need of any further documents or information as CDC is going to act as the information hub, connecting stock market with the banks.

CDC is working on this project zealously with SBP designated banks. The service will be available to NRPs with the availability of the Roshan Digital Account, which is scheduled to be launched very soon. More details will follow soon.

Awareness Sessions

1.      Financial Literacy Initiative: Money Matters Workshop

Since inception, CDC is focused on educating potential investors in the country. As part of this vision, a series of Financial Literacy Workshops have been regularly organized across the country. These past events have proved as a platform where CDC interacts with the potential and current investors, discussing the potential of Pakistan Capital Market, its returns, opportunities and risks.

Continuing its legacy, this quarter, CDC conducted a Money Management workshop at CDC House, Karachi. Mr. Akber Tejani, Founder and CEO of Investomate, a tax filing consultant agency and Director at Befiler, conducted the workshop. Mr. Tejani is a Fellow Chartered Accountant and a seasoned professional with over two decades’ worth of experience in the finance, risk management and assurance services industry. He spoke extensively about cultivating a habit of savings from a young age and investing smartly to gain the right results.

The workshop was attended by people belonging to diverse backgrounds; from young students who were looking to understand the many avenues of investment to elders who were interested in changing their behavior towards savings. The audience showed enthusiasm by actively participating in the workshop. They further appreciated CDC’s efforts regarding how such workshops are vital for people to understand and handle their money better.

2.      Industry-Academia Collaboration: Interactive Presentation at Lahore School of Economics

On a special invitation, Mr. Zafar Iqbal Amin, Incharge CDC Lahore Branch apprised the students of the Lahore School of Economics (LSE) about the dynamics of Pakistan Capital Market and CDC’s role in its transformation, its contribution in investor protection and awareness measures, company’s latest products and services, business diversification and its accreditations on national & international platforms. The presentation concluded with by an interactive Q&A session where students inquired about how they can become part of this thriving organization.

3.      Investor Awareness Seminar

CDC’s flagship investor awareness sessions are a platform where customers and CDC representatives liaise and discuss issues regarding the risks, responsibilities and opportunities with respect to their investment portfolio as well as CDC’s various customer convenience initiatives.

In line with these ongoing efforts, CDC organized an investor awareness seminar on March 04, 2020 at CDC House, Karachi. More than 50 account holders attended the session and discussed matters and issues pertaining to their accounts and investment. A strong demand was put forth by the account holders for a regular frequency of such sessions.

CDC’s Measures for Business Continuity during Lockdown

As countries, communities and businesses combat with the Coronavirus Pandemic, most of the established organizations have implemented ‘Work from Home’ policy, trying their best to resume or continue their business operations while maintaining safety protocols, most importantly ‘Social Distancing’.

At CDC, this challenging situation proved to be a Litmus Test for the Business Continuity preparations that were made for most of the last two decades to ensure that critical business operations continue even in times of disaster. With the continued guidance of the CDC Board of Directors and under the leadership of CEO-CDC, Mr. Badiuddin Akber, the following three-tier strategy was devised by the Senior Management of the Company:

  1. Prioritizing Safety and Well-Being of CDC Staff by implementing ‘Work from Home’ Policy for 90% workforce. Only vital and critical staff attends office with safety and social distancing protocols in place.
  2. Ensuring the Continuity of Services of CDC’s Core Business Lines – Depository Services and Trustee & Custodial Services along with wholly owned subsidiaries i.e. CDC Share Registrar Services Limited and ITMinds Limited (Back Office Accounting Services).
  3. Guaranteeing continuation of Critical Operations for Stock Market, Mutual Funds and Insurance Industry.

Additional Support to Pakistan Capital Market stakeholders and investors

  1. Pakistan Stock Exchange is being facilitated to jointly perform business activities utilizing CDC’s BCP site as well as secure technological standards for accomplishing critical market operations.
  2. IT Desktop Support and Technical Assistance has been provided to account holders and the general public.
  3. CDC’s Digital Services Portfolio remains available to both organizations and individuals to help them undertake routine business activity from the safety of their homes.
  4. CDC’s Customer Support Services continue to provide assistance through Call Center.
  5. CDC’s corporate website (cdcpakistan.com) and Social Media pages on Facebook, Twitter and LinkedIn are being constantly updated with information about precautionary measures to combat COVID-19 and available online facilities & tools by CDC to undertake business activities.

US Consul General in Karachi visits CDC

A delegation from the US Consulate in Karachi, headed by Mr. Rob Silberstein, US Consul General in Karachi visited the Central Depository Company on March 05, 2020. Representatives of leading Pakistani corporates and US Businesses in Pakistan attended this event.

Mr. Moin M. Fudda, Chairman CDC Board of Directors, welcomed the delegation and spoke about the long term bilateral relations between US & Pakistan while stressing on the need to foster greater ties on business and trade initiatives. Mr. Badiuddin Akber, CEO-CDC, while giving an overview on the Pakistan Capital Market landscape and CDC’s key role in its development, highlighted the association between CDC and its counterparts from the US Capital Market.

US Consul General Rob Silberstein lauded CDC on its achievements in transforming the Pakistani Capital Market. He said that “It is important to figure out how we actually bring the two sides closer together for the benefit of both countries. The fact that so much of Pakistan’s financial interest rests on these close people to people and business to business ties between the US and Pakistan is something that needs to be cherished. US and Pakistan should bring together expertise and technology, particularly for bigger future projects through more effective Public Private Partnership.”

Inauguration of CDC’s Revamped Business Continuity Site

It is a matter of pride that Central Depository Company is Pakistan’ first and among the very few organizations in the country and in the world to achieve ISO/IEC 22301: 2015 for its Business Continuity Management Program.

The objective behind this extensive preparation for the past two decades is to ensure that under any unforeseen circumstances – whether its natural disasters, incidents or uncertainties – CDC’s critical business operations continue with optimum efficiency and without any hindrance for all stakeholders.

Continuing with our commitment and resolve to increase our standards of business resiliency, CDC was the first capital market entity to establish a purpose built, dedicated Contingency Site in the year 2000. In line to this endeavor, CDC’s BCP site was recently consolidated from two different sites to a single, augmented and well equipped premises.

Mr. Aamir Khan, Chairman Securities and Exchange Commission of Pakistan (SECP) inaugurated the BCP site on February 24, 2020 in the presence of CDC’s Board of Directors and Senior Management. Mr. Badiuddin Akber, CEO-CDC gave a briefing on the infrastructure and facilities of the site which has a capacity to accommodate 100 people. His briefing covered the following key features of the BCP site:

  1. Fulfills requirements of ISO 22301:2012 globally accepted business continuity standard and BCI Guidelines.
  2. Information Security – Multifaceted measures and technological measures embedded to avoid data loss, information breach and unapproved access.
  3. Monitoring Systems – 24/7 monitoring and security measures have been aligned to trigger warnings regarding utility failures, equipment malfunction and disrupting threats that may hamper routine business activities.
  4. Resilient Telecommunications Networks – All systems are designed to ensure clear communication and connection is established at all times without delay or failure.
  5. Physical Security. Alleviating theft and unauthorized entry. CCTV monitoring.
  6. Contact with Emergency Services such as police, fire, ambulance, government agencies and local authorities;
  7. Emergency evacuation direction;

Chairman SECP, Mr. Aamir Khan greatly appreciated the efforts made by CDC as part of its Business Continuity Management Program.