Diversification of Islamic Financial Instruments
76
Modaraba companies provide investors with Shariah compliant Mudarabah-based savings
instruments, similar to the savings accounts offered by Islamic banking institutions. However,
unlike saving account products, these certificates of investments offered by Modaraba
companies typically have tenures ranging from three months to five years, are for larger
investment amounts (e.g. PKR 50,000 to over 100 million), and offer slightly more attractive
profit rates than Islamic banks (e.g. 5.0 – 6.35% annual).62 The Modaraba companies’ products
range from ‘Certificates of Investments’ (Musharakah or Mudarabah based) or selected
financial services (based mainly on Diminshing Musharakah and Ijarah, and sometimes using
Murabahah, Salam or istisna as well), e.g. financing for computers, motor vehicles, machinery,
plant equipment etc. Like other IFIs, Modaraba companies in Pakistan are also required to
have Shariah advisors. Modarabas are listed at the Pakistan Stock Exchange and typically offer
attractive annual dividend yields.
Table 32. List of Active Registered Modaraba Companies Operating in Pakistan
Sr. No. Name of Modaraba Company
1. First Habib Modaraba
2. BRR Guardian Modaraba
3. Standard Chartered Modaraba
4. Modaraba Al-Mali
5. B.F. Modaraba
6. First IBL Modaraba
7. First Prudential Modaraba
8. KASB Modaraba
9. First Pak Modaraba
10. First UDL Modaraba
11. Trust Modaraba
12. First Fidelity Leasing Modaraba
13. First Elite Capital Modaraba
14. First Equity Modaraba
15. Popular Islamic Modaraba
16. First AL-Noor Modaraba
17. First Punjab Modaraba
18. Crescent Standard Modaraba
19. First Imrooz Modaraba
20. First Paramount Modaraba
21. First National BanK Modaraba
22. First Treet Manufacturing Modaraba
23. Allied Rental Modaraba
24. Sindh Modaraba
25. Unicap Modaraba
26. Awwal Modaraba
27. First Constellation Modaraba
28. First Tri-Star Modaraba
Source: SECP Website, April 2017
62 First Habib Modarabah website. Retreived September 2017. See: