Pakistan has launched a new national strategy to combat money laundering and terrorist financing, with the federal cabinet approving a five-year anti-money laundering policy designed to tighten oversight, improve coordination among agencies, and align the country more closely with global financial crime standards. The move is aimed at strengthening the country’s defences against illicit financial flows, including corruption, tax evasion, hundi and hawala operations, organized crime proceeds, and terrorism financing.
The policy, which covers fiscal years 2026 to 2031, is being presented as a coordinated national response to financial crime rather than a sector-specific reform. According to the available policy details, it is intended to detect, deter, and disrupt illicit money flows by combining legal reform, institutional capacity building, public-private cooperation, risk-based supervision, and stronger international collaboration.
Officials say the strategy reflects the government’s commitment to improving transparency and meeting international expectations, including those associated with the Financial Action Task Force (FATF). The policy also aims to protect economic stability by reducing revenue leakage and limiting the misuse of banks, non-bank financial institutions, digital asset platforms, and other vulnerable channels for illicit transactions.
Policy goals
The newly endorsed strategy sets out several priorities. These include preventing the misuse of the financial system for money laundering and terrorist financing, strengthening the capacity of law enforcement and financial intelligence units, improving coordination between agencies, and expanding compliance obligations for businesses operating in higher-risk sectors.
It also places emphasis on areas that have become increasingly important in modern financial crime enforcement, including cryptocurrency-related activity, cross-border transfers, real estate transactions, precious metals dealing, and suspicious nonprofit funding patterns. Officials say the policy is intended to close loopholes that allow criminals to move money across formal and informal channels.
The government’s approach is framed as a whole-of-state response. That means not only regulators and investigators, but also banks, fintech firms, customs authorities, tax agencies, and other public bodies are expected to play a larger role in identifying suspicious activity and sharing intelligence more efficiently.
Five strategic pillars
The policy is organized around five strategic pillars. The first is legal and regulatory reform, which aims to close gaps in existing legislation, widen the scope of obliged entities, and improve beneficial ownership transparency.
The second pillar focuses on institutional capacity building. Under this approach, law enforcement officials, customs personnel, and financial supervisors are expected to receive specialized training to improve detection, investigation, and enforcement outcomes.
The third pillar centers on public-private partnership and information sharing. A secure data exchange mechanism is planned to allow banks, fintech companies, and government agencies to identify suspicious transactions more quickly and act on them in a coordinated way.
The fourth pillar is risk-based supervision and compliance monitoring. Regulators are expected to direct more attention and resources toward higher-risk sectors such as real estate, precious metals, and crypto-related businesses.
The fifth pillar is international cooperation. The strategy seeks deeper engagement with foreign counterparts through mutual legal assistance and participation in global AML networks, reflecting the cross-border nature of modern money laundering and terrorism financing cases.
Governance and implementation
Implementation is expected to be overseen by a newly formed National AML Steering Committee chaired by the Finance Secretary, with representation from the State Bank of Pakistan, the Securities and Exchange Commission of Pakistan, the Federal Board of Revenue, and law enforcement bodies. The policy indicates that this structure is intended to reduce fragmentation and improve coordination across institutions that handle different parts of the financial crime response system.
The National Assembly bill on the National Anti-Money Laundering and Counter Financing of Terrorism Authority also shows the institutional direction behind the reform. The bill describes the creation of a central authority with powers to coordinate national strategy, review laws and regulations, and act as a focal point for FATF-related and international cooperation matters.
According to the bill text, the proposed authority would function as an overarching body for AML, counter-terrorism financing, and targeted financial sanctions work, while still preserving the powers of existing agencies and departments under their respective laws. It also provides for national coordination, policy guidance, information gathering, and the development of risk assessments and data systems.
Sector impact
Banks and financial institutions are expected to face stronger customer due diligence requirements, including more robust beneficial ownership verification for corporate accounts. Transaction monitoring systems may also need to be upgraded to improve real-time reporting and suspicious activity detection.
Virtual asset service providers, including crypto exchanges and wallet providers, are likely to come under closer regulatory scrutiny as the policy expands AML compliance expectations for digital finance businesses. High-value sectors such as real estate, gold, jewelry, and luxury vehicle trading are also expected to be monitored more closely for cash-heavy or unusual transactions.
Nonprofit organizations may also face greater risk profiling and audits where exposure to high-risk funding sources or jurisdictions is identified. The policy indicates that this is intended to reduce the chances of terrorist financing abuse while preserving legitimate charitable activity.
Broader significance
The strategy comes at a time when governments worldwide are updating anti-money laundering systems to deal with faster payments, digital assets, and increasingly sophisticated criminal networks. Pakistan’s new policy signals an attempt to move from ad hoc enforcement toward a more structured and measurable national framework.
Supporters say the reform could improve compliance, enhance confidence in the financial system, and strengthen the country’s standing in international assessments. However, the policy’s effectiveness will depend on funding, technical capacity, sustained political backing, and the ability of institutions to work together consistently.