ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has mandated that all investment advisors and distributors associated with mutual and pension funds become members of the Mutual Funds Association of Pakistan (MUFAP). This measure aims to bolster investor protection by ensuring adherence to a unified Code of Conduct and a standardized regulatory framework.

According to Securities and Exchange Commission of Pakistan, this initiative seeks to mitigate mis-selling and enhance transparency, thereby fostering greater investor confidence in the safeguarding of their financial interests. The directive also establishes a formal mechanism for addressing complaints and resolving disputes.

The membership requirement targets Licensed Investment Advisors, Licensed Securities Advisors, and distributors working with Asset Management Companies and Pension Fund Managers. As a Self-Regulatory Organization, MUFAP is tasked with facilitating membership and enforcing compliance within the industry. This consolidation under a single platform is intended to enhance oversight, promote professional standards, and streamline market practices.

Moreover, the move is designed to aid in the capacity building and continuous professional development of financial intermediaries, ensuring that they adhere to best practices and remain aligned with market developments. The directive is anticipated to reinforce investor protection, improve market discipline, and contribute to the development of a more transparent and reliable mutual fund sector in Pakistan.