Asset management firms are now permitted to sell ETFs directly to investors.

The new strategy seeks to modernise the sector through the provision of digital platforms, the simplification of investment processes, and the reduction of total costs for investors. A significant alteration in the structure will enable Asset Management Companies (AMCs) to sell ETFs directly to investors, circumventing the conventional necessity for broker assistance and the requirement to establish separate broking accounts.

To diminish investor costs and enhance market accessibility, AMCs will be prohibited from allocating a percentage of their management fees to brokers for fund distribution.

The roadmap, formulated in collaboration with the Pakistan Stock Exchange (PSX), NCCPL, CDC, and the Mutual Funds Association of Pakistan (MUFAP), would be executed in stages. A fundamental feature permits securities brokers to initiate and manage their own ETFs, anticipated to enhance product diversity while reducing substantial administrative expenses.

Furthermore, low-cost alternatives such as Index Tracker Funds will be incorporated into the Voluntary Pension System. The SECP intends to enhance digital infrastructure and initiate nationwide investor awareness efforts to guarantee the success of these measures.