The Securities and Exchange Commission of Pakistan (SECP) has issued a consultation paper eliciting public input on a proposed policy framework for the issuance of ordinary shares with varied rights and privileges by companies. The initiative aims to enhance corporate governance, protect shareholder interests, and foster a transparent capital market by establishing clear regulatory guidelines for companies issuing shares with differential rights, including variations in voting power, dividend entitlements, and liquidation preferences,said a press release issued here. The consultation paper outlines key regulatory and compliance considerations, addressing governance challenges such as control concentration, shareholder activism, and equitable decision-making. It also emphasizes the importance of market transparency and fair price discovery to ensure that investors holding shares with varied rights have clear valuation mechanisms and viable exit options. A comparative analysis of international best practices has been conducted to assess global regulatory approaches and develop a framework suited to Pakistan’s financial ecosystem. SECP has highlighted potential risks associated with differential share structures, including governance imbalances and reduced minority shareholder influence, and is proposing reasonable limits to maintain fairness and uphold investor confidence. The Commission encourages stakeholders, including investors, corporate entities, and legal experts, to provide feedback to help refine the proposed framework. The Securities and Exchange Commission of Pakistan has issued a concept note proposing amendments to the Non-Banking Financial Companies framework. These proposed changes aim to introduce non-banking microfinance services as a distinct form of business within the NBFC framework, providing clarity for entities engaged in microfinance, said a press release issued here on Wednesday. The proposed amendments aim to establish a clear and distinct regulatory framework for microfinance services within the broader NBFC structure. Recognizing Non-Banking Microfinance Services as a separate category, shall enable the Commission to provide tailored regulations that better accommodate the unique needs of microfinance institutions. This distinction will help streamline compliance processes, reduce regulatory overlap, and enhance the ability of microfinance entities to focus on serving underserved and vulnerable populations effectively. The overlap amongst Investment Finance services digital only and microfinance licenses creates ambiguity regarding application of mandatory requirements and operational scope. As digital lending grows, it’s crucial to clearly distinguish microfinance services within the regulatory structure to address the unique needs of the two lending verticals. The SECP has encouraged stakeholders to review the concept note and provide feedback to refine the proposed amendments, ensuring the regulatory landscape evolves with the needs of the sector.