The Senate has recently approved the 26th Constitutional Amendment Bill, 2024, which sets a deadline of January 1, 2028, for ending Riba (interest-based banking) in Pakistan. This amendment was introduced following a proposal from the Jamiat Ulema-e-Islam-Fazl (JUI-F), a political party led by Maulana Fazl-ur-Rehman. Their input created some challenges for the government when the bill was being discussed.
The amendment changes clause (f) of Article 38 of the Constitution, which is about promoting the social and economic welfare of the people. The original wording aimed to “eliminate Riba as early as possible,” but it has been revised to say this should be done “as far as practicable, by the 1st of January, 2028.”
This decision reflects a significant move towards creating an interest-free banking system in Pakistan. The government will need to work on various financial reforms and policies to meet this new deadline.
Many people view this change as a positive step toward aligning Pakistan’s banking system with Islamic principles. However, the government will face challenges in implementing this amendment effectively and ensuring a smooth transition to an interest-free economy.
