Overview
- The transition will use the Central Depository System operated by the Central Depository Company to replace physical certificates with electronic records.
- Existing unlisted companies will be required to convert paper shares before transfers, allotments, rights or bonus issues, buybacks, or any change in shareholding once the formal notification is issued.
- Newly incorporated unlisted firms are already prohibited from issuing physical share certificates and must issue shares in electronic form.
- SECP says digitisation will curb loss, theft, forgery, and fraudulent transfers, reducing ownership disputes and strengthening governance and oversight.
- Electronic shares will cut paperwork and costs, speed transfers and settlement, provide real-time ownership data, and enable pledging as collateral for financing.