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Business Recorder
08-05-2025
- Business
- Business Recorder
Pakistan's banking sector deserves a fairer narrative
In a country gripped by chronic revenue shortfalls and economic instability, one sector quietly shoulders more than its share — yet is frequently criticised. Pakistan's banking sector, the country's largest taxpayer and a critical source of fiscal stability, is often maligned rather than supported. This paradox demands re-examination —and a shift in mindset that continues to distort the public narrative. In 2024, the banking sector, comprising commercial banks, DFIs, and microfinance banks, contributed an astonishing Rs 1.6 trillion to the national exchequer. This includes Rs 856 billion in direct corporate and income taxes, Rs 63 billion in sales and excise duties, and over Rs 685 billion in withholding tax collected and paid. To put this into perspective, that's nearly five times more than what banks paid in 2021. Yet, despite this unmatched contribution, banks continue to face criticism, regulatory unpredictability, and the heaviest tax treatment among all sectors. 'The banking sector contributed Rs 644 billion in taxes in 2023 alone, and in a single day facilitated Rs 30 billion in government revenue. Yet, we are being taxed at rates nearly double other sectors. Taxation must be based on income, not balance sheet size or political expediency. We are partners in progress, not targets for fiscal patchwork.'— Zafar Masud, Chairman, Pakistan Banks Association Banks today pay an effective tax rate of 54 percent, compared to the standard 29 percent paid by most other industries. This disparity is not only disproportionate, it is counterproductive. When institutions that finance infrastructure, businesses, and public services are penalized for their efficiency, the broader economy suffers. Critics often accuse banks of prioritizing government securities over private sector lending. But this ignores Pakistan's underlying economic realities, a persistently wide fiscal deficit, underdeveloped capital markets, and a narrow, undocumented tax base. In FY24 alone, banks financed over 99 percent of the government's budget deficit, ensuring critical expenditures like defence, pensions, and social protection continued uninterrupted. This is not a diversion of resources; it is a stabilising lifeline. Banks are not turning away from the private sector. They are responding rationally to a high-risk environment, where legal enforcement is weak and formal documentation is scarce. Until structural reforms are achieved, sovereign lending remains the most prudent and often regulatorily encouraged option. 'With 54 percent of the banks' income directed to the government, it is only fair that we are treated as partners. Time and again, whenever the government has called upon the banking industry, we have always stepped up, a commitment we will proudly uphold in the best interest of Pakistan. As one of the most transparent sectors of the economy, we remain dedicated to contributing to Pakistan's progress and trust our efforts will be acknowledged.' — Atif Bajwa, Chairman, Pakistan Banking Summit Steering Committee Much of the criticism directed at banks is based on generalizations. The sector collectively employs over 200,000 people and is actively increasing gender diversity under the State Bank's inclusion mandate. While service delivery can always improve, to suggest banks are uniformly exploitative is inaccurate. Moreover, the banking sector is among the most heavily regulated, audited, and transparent in the economy. It is also among the most forward-looking supporting SMES, agri-finance, housing, and digital transformation, even in a volatile economic climate. 'Profitability should not be treated as a red flag; it is a prerequisite for financial resilience and national progress.' The broader issue is this, when a compliant and transparent sector like banking is disproportionately burdened with taxation while vast segments of the economy remain undocumented, the incentive structure becomes distorted. No society can progress when responsibility is concentrated on a few formal sectors while others remain unregulated and under-taxed. Pakistan's banking sector is not asking for applause—it is asking for fairness in taxation and recognition of its role as a partner in national development. It has delivered when it mattered most. A transparent, tax-compliant sector that supports public finance, SMEs, and digital transformation deserves policy consistency—not punitive treatment. It is time for policymakers and the public to do the same: anchor the debate in facts, and shift the conversation from blame to balance. Copyright Business Recorder, 2025
Express Tribune
28-02-2025
- Sport
- Express Tribune
Special Olympics: Pak athletes get a boost
Pakistan's athletes who will represent the country in Special Olympics World Winter Games 2025 in Turin are seen with the SOP and Bank Alfalah officials at the ceremony. PHOTO: SOP A special ceremony was held at the Bank Al Falah head office on Thursday to extend the best wishes to Pakistan's athletes ahead of the Special Olympics World Winter Games 2025 in Turin, Italy. Bank Alfalah partnered with Special Olympics Pakistan (SOP), a non-profit organisation dedicated to empowering individuals with intellectual disabilities through year-round sports training and competitions. The SOP will be sending the athletes to the winter games for the third time. Previously, the country competed in 2013 and 2017. Ronak Lakhani, Chairperson and Board Member of Special Olympics Pakistan, expressed her enthusiasm for the 10 athletes: "This partnership is a game-changer in our mission to empower athletes with intellectual disabilities across Pakistan. By expanding our reach and creating more opportunities, we are supporting these athletes, breaking barriers, and redefining inclusion in sports. I do not doubt that these 10 extraordinary athletes will make Pakistan proud globally, inspiring countless others with their determination and resilience." The Special Olympics World Winter Games Turin 2025 is a major international sporting event scheduled from March 8 to March 15, 2025, in Turin, Italy, with the motto, "The Future is Here", reflecting its commitment to showcasing the abilities and achievements of athletes with intellectual disabilities, promoting inclusion and unity through sports. This event will unite over 500 athletes from 102 countries, competing across eight winter sports disciplines. It will include eight disciplines: Alpine skiing, cross-country skiing, dance sport, figure skating, floorball, short-track speed skating, snowboarding, and snowshoeing. The athletes from Pakistan will be participating in Alpine Skiing and snowshoeing. Over the period of two years, the bank funded a PKR 9 million training program through this collaboration, benefiting 500 athletes. This collaboration supports SOP's objectives by engaging over 500 special and mainstream athletes through regular sports programming, organising live-in training camps for selected athletes, and developing a 50-coach and technical staff network. "Bank Alfalah believes in the power of sports to transform lives and build a more progressive and inclusive society," said Atif Bajwa, President and CEO of Bank Alfalah.
