NBFI & Modaraba Association of Pakistan (The Association) was incorporated on 29th July,2010 by merging Modaraba Association of Pakistan (MAP) and Leasing Association of Pakistan (LAP). The total numbers of members of the Association are 38 (thirty eight) which includes 25 modarabas, 10 leasing companies and 3 investment banks.
The Trade Organization Ordinance, 2007 and Trade Organizations Rules, 2007 were promulgated simultaneously on 14th December, 2007 and 7th June, 2006 respectively, in terms of which every existing association has to obtain a fresh license as an existing trade body. MAP was incorporated on 17th April, 1994 and LAP was incorporated on 22nd June, 1995 under Section 42 of the Companies Ordinance, 1984. In order to comply with the Trade Organization Ordinance, 2007, MAP and LAP applied for fresh license separately as an existing trade body and completed all the requirements under the Ordinance.
The Director General, Trade Organization, (DTO) Islamabad declined the requests of both MAP and LAP for grant of license. According to the DTO there were four associations in the non-banking finance sector in the fields of leasing, modaraba, mutual funds and investment banks, having identical functions and representing the same and significantly similar trading sector and operate under the control of SECP as non-banking finance companies. The Section 33 of the Trade Organizations Ordinance which reads hereunder:-
The DTO required merger of these associations under section 33 of the Ordinance, and directed to submit an agreed proposal with regard to the issuance of license to the representatives of the said trade, industry and services.
The Executive Committees of MAP and LAP in their respective meetings approved the merger of both the Associations with and into each other while Mutual Funds Association took the plea that the business activities of members of the Mutual funds were quite different from the other three Associations. Accordingly, MUFAP succeeded in getting a fresh license as an existing trade body under the Trade Organization Ordinance, 2007. Initially Investment Banks Association of Pakistan agreed to join MAP and LAP for the merger but subsequently decided to maintain a separate status though some of their members were also the members of the Leasing Association. Consequently, the MAP and LAP merged with and into each other and a new entity named "NBFI & MODARABA ASSOCIATION OF PAKISTAN" was established and Certificate of Incorporation obtained from SECP on 29th July, 2010. By virtue of this merger all the members of MAP and LAP became the members of the newly established Association.
With the establishment of this Association, MAP and LAP have been wound up voluntarily and all the requirements for member's voluntary winding up have been completed.
In order to increase the membership of the Association and make it a true representative body of NBFI sector, the Memorandum of the Association provides for the inclusion of Modaraba, Leasing, Investment Finance Services, Housing Finance, Investment Advisory Services, Discounting Services, Private Equity/Venture Capital, REITS and such other business as permitted to be conducted by the members of the Association. By inviting all these entities, the scope of the Association can be widened.
The mission of the Association is to provide a forum to the Leasing & Modaraba Companies in Pakistan, to confer on all issues of common interest, to formulate join strategies for their operations. The Association is striving to restore the image of the Financial Services sector in Pakistan.
The Association provides a strong platform to members to liaise with the Regulatory Authorities to create an enabling environment for members to promote their business and contribute towards economic development of the country specially SME sector which is the backbone of Pakistan's economy and major job creator in the country.