Leasing Services Licence in Pakistan: Procedure

Leasing licence: regulated activity and lawful routes

Financial leasing in Pakistan is a regulated financial-services activity. Under rule 2(1)(xxix) of the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003, leasing means financing through an operating lease, finance lease or Ijarah. A business proposing to finance equipment, vehicles, plant or other assets through these arrangements should establish the correct Securities and Exchange Commission of Pakistan (SECP) licensing route before soliciting customers or originating regulated transactions. A certificate of incorporation, tax registration or ordinary equipment-rental agreement does not substitute for NBFC authority.

There are two principal routes. First, a promoter may seek SECP permission to form a non-banking finance company (NBFC), incorporate the approved company and apply for a standalone leasing licence. Secondly, an existing NBFC holding an investment-finance-services (IFS) licence may undertake leasing without a separate leasing licence by virtue of rule 5(4) and regulation 4, provided its licence remains valid and it maintains the IFS minimum equity and applicable prudential safeguards. The IFS exception is not an exemption for an unlicensed company, and a standalone leasing licence does not automatically authorise every other financial business.

The commercial product must be defined precisely. An operating lease may involve asset use and residual-value risk; a finance lease may have a different economic allocation of ownership, repayment and end-of-term options; Ijarah introduces contractual and Shariah considerations. The legal classification depends on the actual documents, cash flows and activity, not merely the label on a customer contract. Ordinary hire of assets without a financing function should be assessed separately rather than automatically treated as NBFC leasing. The starting instruments are the NBFC Rules, 2003 ↗ and NBFC Regulations, 2008, consolidated through 15 January 2026 ↗.

SECP's older leasing licensing overview ↗ remains useful for the sequence of approvals but still refers to the Companies Ordinance, 1984 and a public-company incorporation route. Applicants should reconcile that historic website wording with the current Companies Act, 2017, the amended NBFC Rules and SECP's current formation checklist, rather than treating it as a definitive statement of every permissible corporate form.

Who may establish a leasing NBFC? Eligibility and capital

Promoters, directors and senior management. Rule 3 requires the proposed promoters, directors, chief executive and board chairman to meet fit-and-proper standards. Schedule I to the NBFC Rules and Schedule IX to the NBFC Regulations address professional competence, integrity, financial soundness and relevant disclosures. SECP's leasing checklist asks for identity documents, qualifications, relevant experience, tax status, directorships, financial interests and affidavits. The final assessment is fact-sensitive; a bare statement that a sponsor has business experience is not a substitute for documentary evidence.

Corporate form and governance. Rule 4 establishes the prior-permission route. The 2025 leasing checklist describes private and public company board configurations, whereas SECP's older licensing webpage speaks of a public limited company. Before filing, confirm the proposed company's form, minimum directors, independent-director arrangements and applicable company-law obligations with SECP against the current rules and any case-specific permission. The checklist also calls for board composition, proposed CEO particulars, conflicts and, where applicable, independent-director certification. Do not apply every checklist statement mechanically where an enacted rule or a later notification provides a different test.

Minimum equity depends on the precise licence. Regulation 4 and Schedule I of the consolidated NBFC Regulations prescribe PKR 50 million for a non-deposit-taking NBFC seeking a standalone leasing licence. An ordinary non-deposit-taking IFS licensee, which may also undertake leasing under the IFS permission, is subject to the separate PKR 100 million IFS minimum. New deposit-taking NBFCs seeking a leasing or other listed lending licence fall under a PKR 1,000 million category; the Schedule separately provides PKR 500 million for an existing NBFC holding a valid deposit-taking permission and leasing licence. These are minimum-equity requirements, not application fees, and the deposit-taking categories do not themselves confer permission to raise public deposits.

Restricted combinations. Rule 5(2) separates lending NBFC businesses from fund-management NBFC businesses. A leasing applicant must not assume that an asset-management or investment-advisory licence can be combined with a lending licence. Likewise, digital-lending, microfinance or deposit-taking concessions in Schedule I are conditional categories; their lower figures must not be used to capitalise an ordinary standalone leasing company. Where sponsors already control a regulated group company, the group-licensing restriction in rule 5(6) requires separate consideration.

Foreign and public-sector participation. Foreign promoters and directors may require authenticated or apostilled documents, passports, financial-standing evidence and security clearances according to their circumstances. Government servants and public-sector entities may need employment or competent-authority approvals. The SECP checklist discusses these conditional requirements, but applicants should identify which actually apply rather than presenting every item as universal.

Formation and licence application documents

The formation dossier and the operating-licence dossier are separate. SECP's leasing-specific checklist and annexed Forms I and II ↗ should be read with the enacted rules, and a documentary index should show the status of each item.

Formation permission (Form I): proposed and reserved name with rationale; sponsor and proposed director particulars; draft memorandum and articles with suitable leasing objects; prescribed fee receipt; signed application and accuracy/fit-and-proper affidavits; financial-standing and tax records; proposed ownership structure and controlling persons; and a business plan addressing product, financing, staffing, controls and at least three-year cash-flow projections as requested by the checklist.
Management evidence: CNIC or passport, professional qualifications, employment and senior-management history, other directorships, beneficial ownership and relevant regulatory declarations for each relevant person. Prepare supporting documents for the proposed chief executive and any business head; disclose conflicts and financial interests rather than relying on a generic biography.
Foreign sponsors: where applicable, apostilled or consular-authenticated identity and financial documents, banking references, translated documents, and information needed for Ministry of Interior clearance. Which authentication route applies depends on the document's country of origin and applicable arrangements.
Operating licence (Form II): certificate of incorporation and certified constitutional documents; evidence of subscribed and paid-up capital; auditor's minimum-equity certificate; bank or proceeds-realisation evidence of subscription money; directors' and CEO's particulars; blocked-share arrangements and undertakings where required; final leasing business plan, governance policies, internal controls and evidence that formation-permission conditions have been satisfied.
Product and risk file: specimen lease/Ijarah agreements, asset acquisition and title process, insurance/takaful policy, borrower onboarding and disclosures, valuation methodology, credit policy, recovery and repossession controls, complaints procedure, information security and accounting treatment. Some are practical readiness evidence rather than universally named statutory enclosures; SECP may request further material based on the proposed product.

The 15 May 2025 leasing checklist contains apparent copy-forward references to Asset Management Services, including a PKR 200 million equity figure and a licence description inconsistent with its leasing heading. Those passages should not be repeated as the operative leasing standard: the enacted Schedule I governs the applicable leasing equity. The checklist also refers to a fee schedule with inconsistent numbering; the controlling fee figures are in Schedule II of the consolidated NBFC Regulations.

How to obtain a leasing services licence in Pakistan

01
Map the regulated activity and applicant category
Document the proposed assets, customer class, lease tenor, ownership and purchase options, funding model and any Islamic-finance structure. Decide whether the applicant needs a standalone leasing licence or is already authorised as an IFS NBFC. Separately identify deposit-taking, digital channels, consumer lending and cross-border features requiring additional analysis.
02
Clear the name and prepare the formation file
Use SECP's current company-name and incorporation facilities to check the proposed name, and prepare Form I under rule 4. Compile sponsor wealth and fit-and-proper evidence, proposed directors and CEO records, draft memorandum and articles, and a detailed leasing business plan. The formation permission application is made to SECP's licensing function; name reservation alone does not authorise incorporation as an NBFC.
03
Submit Form I with the prescribed fee
Under Schedule II-A of the consolidated Regulations, the ordinary NBFC formation-permission fee is PKR 250,000, non-refundable. Confirm the current SECP payment instructions and obtain a traceable receipt. SECP may ask for additional evidence or clarification and will assess the proposed sponsors, financial resources and governance before issuing a written permission.
04
Incorporate during the permission period
Rule 4(3) provides that formation permission is valid for six months. In special circumstances it may be extended by up to three further months on an application made before expiry. Within the permission's validity, promoters must incorporate the company and submit the operating-licence application. Company incorporation requires its own SECP filing and fees; it is not equivalent to the NBFC operating licence.
05
Capitalise and document the licensed company
Bring in shareholder funds through a documented banking trail, establish corporate and governance records, obtain the auditor's capital/equity confirmation, and implement controls for leasing contracts, asset ownership, credit decisions, compliance and reporting. Review share-blocking requirements and shareholder undertakings under rule 5(6) and the checklist, including any applicable exemption for qualifying directors' shares.
06
Apply for the operating licence on Form II
File Form II with the incorporated company's particulars, the required supporting material and the ordinary non-refundable operating-licence fee of PKR 500,000 under Schedule II-A. SECP may request a presentation or further information and will assess fit-and-proper status, capital, governance, licensing eligibility and any permission conditions. Do not offer regulated leasing merely because Form II has been submitted.
07
Implement the issued licence and post-approval controls
Review the exact licence, conditions and permitted activity before commencement. Complete tax, accounting, AML/CFT and customer-disclosure arrangements as applicable; maintain a board-approved credit policy, financial reporting calendar, customer grievance channel and asset-security records. For an existing IFS licensee using rule 5(4), record the legal basis for leasing and any conditions or notices required by SECP.

No guaranteed SECP processing period. The six-month rule above is the validity of formation permission, not a promise that SECP will approve an application within six months. The regulator's information requests, sponsor screening, security clearances and file completeness can affect the sequence and duration. SECP leasing licensing procedure ↗.

Prudential obligations and ongoing compliance

Capital and asset allocation. A leasing NBFC must maintain the minimum equity applicable to its licence throughout operations, not merely on the application date. Regulation 28(a) requires a leasing company to invest at least 70% of the relevant asset base in leasing on a quarterly-average basis. Cash, deposits with financial institutions and government securities are excluded from the calculation; the amended provision permits vehicle financing to be included when calculating leasing investment. Regulation 28(ca) gives a newly licensed lending NBFC one year from licensing to meet the applicable primary-business investment threshold, or a longer period allowed by SECP at licensing. A financial model should test these rules against projected disbursements, not assume that cash awaiting deployment counts as leasing exposure.

Prudential supervision. Leasing companies are lending NBFCs. Their policies must address borrower creditworthiness, concentration and related-party exposure, collateral and margin policy where relevant, asset classification and provisioning, rescheduling, recovery and periodic regulatory reporting. Regulation 25 requires quarterly review of recoveries and provisioning and external-auditor examination of classification and provisioning compliance. The credit policy should also specify asset valuation, vendor diligence, insurance or takaful, legal ownership, end-of-term options and treatment of returned assets.

Customer treatment and disclosures. Regulation 28(da) empowers SECP to specify requirements concerning fair borrower treatment, pricing disclosure, digital channels, data protection and information security. Regulation 28(dc) addresses the grievance-redressal system, and regulation 28(dd) requires lending NBFC websites to provide specified financial statements, board information, complaints details, branch contacts where applicable and SECP complaints information. The November 2025 lending amendments introduced additional customer-protection measures; the current product design must be checked against the amended text and applicable circulars rather than an outdated specimen lease.

Deposit taking is not incidental funding. A non-deposit-taking leasing company must not treat public deposits as an ordinary source of funds. Sponsor capital, bank financing, institutional lines, debt instruments and security deposits each require their own legal classification. The rule 2 definition of deposit contains exclusions and a regulatory determination mechanism; it should not be stretched to relabel money raised from the public. A deposit-taking NBFC requires the relevant valid permission and the substantially different capital regime.

Contract enforceability and local variation. For every leased asset, identify the contracting entity, title documents, purchase invoice, delivery/acceptance evidence, risk of loss, insurance beneficiary, registration requirements, taxes and remedies on default. Motor vehicle registration, transfer, stamp duty, local taxes and enforcement may differ by province or territory. The SECP licence is federal, but it does not eliminate provincial registration or fiscal obligations. An Ijarah product additionally requires a carefully reviewed Shariah-compliant contractual allocation rather than simply changing terminology.

Renewal and change control. Form IV is the prescribed renewal form; Schedule II-A shows a nil application fee for ordinary NBFC licence renewal. That does not remove the obligation to apply within the period required by the Rules and the licence, or to comply with continuing conditions. Changes in controllers, directors, capital structure, constitutional documents, licensed activities and branches may trigger notification or prior-approval requirements. Maintain a compliance register with actual due dates and evidence of filings rather than assuming that the formation checklist exhausts post-licence duties.

Primary-source reconciliation and regulatory changes

Editorial status: Substantive primary-source review completed. INDEPENDENT LEGAL-EDITOR SIGNOFF PENDING. This does not certify that an independent lawyer has approved the guide.

Which text controls? The amended NBFC Rules ↗ govern eligibility, formation permission, Form I, Form II, licence conditions and renewal. The consolidated NBFC Regulations ↗ govern minimum equity (regulation 4 and Schedule I), fees (Schedule II), prudential rules (including regulations 24–28), reporting and consumer safeguards. SECP's leasing checklist ↗ supplies operational filing detail but contains apparent asset-management template text; where inconsistent, enacted instruments and subsequent binding notifications take precedence.

Applicant distinctions verified against the primary text. The standalone non-deposit-taking leasing equity requirement is PKR 50 million; the IFS route requires its own PKR 100 million minimum; deposit-taking categories have separate figures and permissions. The Form I and Form II fees are PKR 250,000 and PKR 500,000 respectively for ordinary NBFCs; renewal Form IV carries no application fee in Schedule II-A. The six-month NOC period, conditional three-month extension and rule 5(4) IFS leasing entitlement are in the Rules themselves. These are not estimates derived from a consultant's pricing table.

Later notifications and consultation drafts. SECP's published notifications register ↗ includes the S.R.O. 1638(I)/2026 draft amendments to the NBFC Regulations listed on 29 September 2026. A consultation draft is not operative merely because it appears in the register. No provision of that draft has been incorporated here as binding law without identification of a subsequent final notification. The January 2026 consolidated text incorporates earlier enacted amendments, including S.R.O. 2120(I)/2025 concerning lending regulation. Before a new filing, check the notifications register again for any final amendments, fee changes or specific SECP directions issued after the consolidated edition.

Practical file review. Counsel should reconcile each checklist enclosure against the correct sponsor category and the applicable schedule, mark inapplicable items with reasons, document discrepancies raised with SECP and retain dated copies of the regulations, checklist, filed forms, payment receipts and regulator correspondence. The most consequential error to avoid is using the leasing checklist's copied PKR 200 million asset-management figure instead of the statutory leasing category, or assuming that IFS coverage eliminates all leasing-specific prudential duties.

Governing legislation and official instruments

The principal framework comprises the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003, the Non-Banking Finance Companies and Notified Entities Regulations, 2008 as amended, the Companies Act, 2017 and applicable SECP notifications, directions and AML/CFT obligations. Corporate incorporation and the regulated financial activity are legally distinct. SECP's current instruments and the individual licence should be checked together before filing or commencing operations.

How Chambers can assist

Chambers can review the legal route, identify regulatory constraints, prepare or review the supporting corporate and legal documents, manage the prescribed submission and correspond with the competent authority where instructed. The scope of the engagement will be determined by the applicant’s particular circumstances.

For an initial enquiry, identify the proposed activity, applicant entity and current stage, and provide the available documents indicated above. Please avoid sending confidential or identity-sensitive records through an unencrypted first contact.

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Common questions about Leasing Services Licence

Does a leasing company need a separate SECP licence?

A new standalone leasing NBFC needs formation permission, incorporation and an operating licence. A qualifying existing investment-finance-services NBFC may undertake leasing under rule 5(4) without a separate leasing licence, subject to the IFS capital requirement and other conditions.

What is the minimum equity for a leasing NBFC?

Schedule I prescribes PKR 50 million for a standalone non-deposit-taking leasing NBFC, PKR 100 million for an ordinary non-deposit-taking IFS licence and different higher thresholds for deposit-taking categories. Equity is not the same as an application fee.

What are the SECP application fees and formation-permission deadline?

Schedule II-A prescribes PKR 250,000 for ordinary NBFC Form I permission, PKR 500,000 for Form II licensing and nil application fee for Form IV renewal. Rule 4(3) gives formation permission six months, with a possible three-month extension requested before expiry.

Which documents are required for leasing licensing?

Form I requires sponsor and director fitness evidence, draft constitutional documents, financial standing, business plan and fee evidence. Form II follows incorporation and requires corporate records, auditor-confirmed minimum equity, capital payment evidence, governance and compliance materials and any conditional foreign or public-sector clearances.

Are SECP's 2026 draft NBFC amendments already law?

No. The September 2026 S.R.O. 1638(I)/2026 is labelled a draft in SECP's notifications register. Applicants should rely on enacted rules and any subsequently published final amendments, not treat consultation proposals as operative provisions.

This guide is general information, not advice on your facts. Check the applicable law, notifications, updated regulator checklists and jurisdiction before acting. The authority alone determines eligibility, acceptance and approval; no outcome or processing period is guaranteed.