Pakistan to launch capital market development fund to boost investor participation

Pakistan is set to launch the Capital Market Development Fund (CMDF), a strategic initiative aimed at expanding investor participation and strengthening the country’s capital markets.

According to sources familiar with the development, key institutions including the Securities and Exchange Commission of Pakistan (SECP), Pakistan Stock Exchange (PSX), Central Depository Company (CDC) and National Clearing Company of Pakistan Limited (NCCPL) are joining hands to establish the fund.

The CMDF will be launched with seed capital of 120 million Pakistani rupees, contributed collectively by major market infrastructure institutions. The fund will support investor education, awareness and broader market development initiatives across the country.

Officials said the core objective is to increase financial literacy and broaden retail participation, particularly among students, youth and small investors. Under the initiative, seminars, roadshows and awareness programs will be held nationwide, with a focus on smaller cities and underserved regions.

The launch comes as Pakistan’s capital market sees a steady rise in retail participation. As of March 2026, the number of individual investors at the Pakistan Stock Exchange has surpassed 563,555, reflecting growing public interest in equity investments.

However, this still represents only about 0.2% of the population, indicating significant untapped potential. Data shows nearly 65% of new retail investors are from smaller cities and towns, underscoring the need for targeted outreach.

Market experts say the CMDF could help bridge the knowledge gap, improve investor confidence and support long-term capital market development.

The signing ceremony in Islamabad will formally mark the start of the fund’s operations, bringing together key stakeholders to promote a more inclusive and vibrant market ecosystem.