ISLAMABAD - The Securities and Exchange Commission of Pakistan (SECP) is introducing several reforms for revival of capital market within next two years and enhance financial literacy in the country.

The commission is on the way to ensure establishment of fair, vibrant and inclusive market, SECP Chairman Muhammad Ali told journalists at a press conference here, adding that law for demutualization of exchange would be finalized by September this year that would bring about some drastic changes in the working of the stock exchanges. Muhammad Ali said that the commission recently introduced several new schemes and was on way to introduce many others to create financial literacy among the people. He said that people of the Pakistan have very low financial literacy as the country’s financial access is lowest among the regional countries.

He said that the commission intends to launch Invest Education Programme with the help of various stakeholders which is aimed at holding seminars, conferences, events and dissemination of literature to educate people,particularly the youth to enhance their financial literacy.

In addition, a full-fledged media campaign would also be launched for financial literacy, he said adding the SECP plans to hold three seminars per week to achieve this goal. He said that the SECP has recently launched Takaful Insurance Rules that would enable the old companies to introduce Islamic financing.

Earlier, when Takaful Insurance was launched, only new companies were entitled to introduce this scheme who were provided five years time to establish their companies by using this product.

However, now five years have elapsed, and the SECP has introduced rules to allow the old companies utilized this facility. He expressed the hope that Islamic Takaful would help enhance investment in the insurance which he said is as low as 0.7 percent.

He said that SECP targets to enhance the overall insurance from the existing 0.7 percent to 1.2 percent during next three years, an increase of about 70 percent.

To a question, he said that work on Anti-Terrorism Insurance Pool, with the financial assistance of Asian Development Bank (ADB), was in progress under which major losses inflicted due to terrorist acts would be covered.

Giving details, he said that at present, an insurance company could provide only Rs.2 million for such losses (even if the loss is in billions), however, when Anti-Terrorism Insurance Pool become effective, it would be able to cover all the major losses.

He said that the Insurance pool would be created by several insurance companies as it would not be feasible for a single company to provide coverage for huge losses.