Kashf Foundation (hereafter referred as “KF” or “the Foundation”) is the first Microfinance Institution of the country. It is licensed by the Securities and Exchange Commission of Pakistan (SECP) under the Non-Banking Finance Companies Rules, 2003. Its registered office is situated at 1-C, Shahrah Nazaria-e-Pakistan, Lahore. Kashf was established in 1996 and began operations as a Grameen replicator. It was incorporated with the SECP in 2007 as a public company limited by guarantee and licensed as a non-profit organization under Section 42 of the Companies Ordinance, 1984 (now Companies Act, 2017). Kashf Foundation’s principal activity is to provide micro-finance services to poor households in order to enhance their economic role. The Foundation extends micro and small loans to underprivileged communities with a maturity of less than or equal to one year. Most of the Foundation's portfolio is concentrated in urban areas of Punjab. The main product of the Foundation is the “Kashf Karobar Karza (KKK)” loan which is provided to boost entrepreneurship and small businesses in the country. Almost 100% of the Foundation’s clientele is female. As of Jun-26, the Foundation has 498 branches (FY25: 422; FY24: 382) in Pakistan.

Kashf Foundation is a public limited company, limited by guarantee without having a share capital. The Company is governed and supervised by its board of directors, having 10 directors who are non-executive / independent. Moreover, there are also 17 members of the company and in case of the company being wound up every member has committed a specified guarantee amount in accordance with the stipulation of the companies Act, 2017. This structure not only aligns with legal requirements but also reinforces the Foundation’s mission-driven approach. Since its inception in 2007, the Foundation has demonstrated growth by maintaining a stable position within the Microfinance Institutions (MFIs) sector. This stability has been achieved through prudent financial management, strategic planning, and a commitment to its core mission. Moreover, a comprehensive succession plan is in place to ensure the continuity of leadership and operational effectiveness. The members of the Foundation are seasoned professionals with a wealth of experience and a diverse skill set, enabling them to effectively guide the Foundation in achieving its objectives. The Foundation’s strong equity base, healthy cash flows, and sound financial management practices underscore its continued financial stability. These strengths are further supported by diversified revenue streams and a disciplined strategic approach to financial sustainability. While the Foundation maintains this robust position, the likelihood of receiving financial support from its members remains limited due to its registration as a not‑for‑profit entity under Section 42 of the Companies Ordinance, 1984 (now Companies Act, 2017), which restricts the solicitation of direct financial contributions from members.

Kashf boasts a distinguished board of directors (BODs) comprised of ten dedicated members, led by the esteemed Dr. Hafiz Ahmed Pasha as the chairman. The board members bring extensive experience in financial and banking services. Dr. Hafiz Ahmed Pasha, the Chairman, is a retired civil servant and leading economist with a PhD from Stanford University. He has held several prominent public appointments, including Advisor to the Prime Minister, Deputy Chairman of the Planning Commission, and Federal Minister in various capacities. Internationally, he served as Assistant Administrator and Regional Director of the UNDP, among other notable roles. Dr. Pasha is the first Pakistani to hold the distinction of United Nations Assistant Secretary General. The CEO, Ms. Roshaneh Zafar, has over two decades of experience and has worked with the World Bank. The CFO, Mr. Shahzad Iqbal, is a Fellow Chartered Accountant (FCA) with significant experience in the telecom sector. This strong leadership team is further supported by a diverse and seasoned group of professionals, ensuring effective governance and operational excellence. The Board members have extensive experience in the various fields, e.g., corporate governance, enterprise technology solutions, finance, environmental sciences, fintech, banking, and capital markets. There are seven sub-committees to assist the Board, namely (i) Audit Committee, (ii) Credit, Program & Finance Committee, (iii) Human Resource Committee, (iv) Investment Committee, (v) Nomination Committee, vi) Risk Management Committee, and vii) IT Committee. Attendance during the meetings was good, and minutes were properly documented. A.F. Ferguson & Co., Chartered Accountants, are the external auditors of the Company. They expressed an unqualified opinion on the financial statements for the year ended June 30, 2025. Currently, the audit for FY26 is in process.

Kashf is a not-for-profit organization and a public company limited by guarantee without share capital. All directors are non-executive and/or independent and are selected from among the Company’s 17 members, each of whom has undertaken to contribute a specified amount to the Company’s assets in the event of winding up, in accordance with SECP statutory requirements. The Foundation is led by its founder and CEO, Ms. Roshaneh Zafar, who has guided the organization since inception and sets its strategic direction, drawing on her experience in development economics and social entrepreneurship. She is supported by a senior Management Committee comprising Mr. Mumtaz Iqbal (COO), Ms. Shahla Sattar (CRO), Mr. Faisal Malik (CTO), Mr. Shahzad Iqbal (CFO), Mr. Mueen Afzal (CHR), and Ms. Saira Soofi (CLO), overseeing operations, risk, technology, finance, human resources, and legal functions. The team manages microfinance operations, ensures regulatory and financial compliance, drives technology-enabled transformation, and strengthens risk management frameworks. A structured decision-making framework is in place, with seven-member management committees overseeing key operational areas. Department heads ensure smooth functioning of their units and report directly to the CEO, with strong interdepartmental integration enhancing decision-making. The CIB reporting system is integrated with Tasdeeq and Data Check Limited to provide real-time data. The Foundation has implemented a comprehensive risk management policy covering operational and credit risks and continues to invest in technological infrastructure to improve automation and efficiency. As informed by the management previously, the Foundation is working diligently to leverage technology to promote women’s literacy and digital empowerment.

In Pakistan, there are currently ~42 licensed Non-Bank Microfinance Companies (NBMFCs) providing specialized microfinance services as of Dec’25 (Dec’24: ~39). During CY25, the MFIs and RSPs segment accounted for ~36.1% of the sector’s GLP, up sharply from ~23.0% in CY24. The infection ratio of this segment remained very low compared to MFBs, improving further to ~0.9% in 1HFY26 (FY25: ~1.1%; FY24: ~1.3%). MFIs maintain lower infection ratios than MFBs as they primarily extend smaller, regular loans to low-risk borrowers, often under structured group-lending models, fostering stronger repayment discipline and reducing default risk. Borrowings of MFIs have shown a steady upward trend, rising to ~PKR 69.4bln in 1HFY26 from ~PKR 61.4bln in FY25 (a five-year CAGR of ~18%), reflecting growing reliance on external, wholesale funding, mainly from commercial banks, supplemented by the Pakistan Microfinance Investment Company (PMIC) and other development finance channels, given MFIs’ restriction from accepting public deposits, to support portfolio growth. Effective liquidity management therefore remains crucial for these MFIs, given their inherently high operating costs. MFIs posted improved profit after tax in FY25 on the back of higher net markup income and sizeable portfolio growth. The average loan size of MFIs increased further, contributing to a decline in cost per borrower. The Foundation is one of the largest NBMFCs in Pakistan by Gross Loan Portfolio and outreach. Excluding SBP-regulated Microfinance Banks with telecom-backed origins, such as Mobilink Microfinance Bank and Telenor Microfinance Bank (Easypaisa), Kashf remains among the largest entities in this segment. The Foundation recorded interest income of ~PKR 19,898mln in FY26, reflecting ~17.62% growth from ~PKR 16,918mln in FY25 (FY24: ~PKR 14,309mln), primarily driven by higher returns on loans amid continued portfolio growth. Earning assets constituted ~93.1% of total assets as of Jun’26 (FY25: ~93.1%), reflecting a high proportion of income-generating assets. The Company posted a surplus after tax of ~PKR 2,864mln in FY26 (FY25: ~PKR 2,762mln), extending the turnaround from the ~PKR 672mln loss in FY24, which had stemmed mainly from the settlement of tax liabilities. Strategically, Kashf aims to expand its market presence and deepen financial inclusion nationwide through product diversification, while maintaining consistent operational and financial performance.

Kashf operates as one of the larger Microfinance Institutions (MFIs), with a decentralized loan approval and disbursement system implemented at the branch level. To mitigate asset-related risk, the organization maintains a structured control and recovery mechanism. As of end-June 2026, Kashf maintained a Gross Loan Portfolio (GLP) of ~PKR 51,515 million, up ~38.6% from ~PKR 37,173 million in FY25 (FY24: ~PKR 28,977 million). Non-Performing Loans (NPLs) stood at ~PKR 182 million as of end-June 2026 (FY25: ~PKR 135 million; FY24: ~PKR 157 million), with the PAR-30 ratio at ~0.35%, broadly stable versus ~0.36% in FY25 (FY24: ~0.54%). The loan book is well-diversified across various sectors, including Services (38.6%), Agriculture and Livestock (26.9%), Trading (16.3%), Domestic (10.4%), and the remaining in manufacturing, Garments & Handicrafts, schools, and others (7.7%), which reduces the Foundation’s exposure to sector-specific risks. Kashf Foundation maintained a broadly stable earning-asset mix, with investments comprising ~15.9% of total earning assets in FY26, unchanged from FY25 and slightly below ~16.5% in FY24. As of FY26, the Foundation’s total funding stood at ~PKR 56,266mln, up ~38.0% from ~PKR 40,758mln in FY25 (FY24: ~PKR 35,098mln). The average cost of funding for the Foundation eased to ~15.4% in FY26 from ~18.9% in FY25, broadly in line with the declining interest rate environment. Liquid Assets as a percentage of Short-term Borrowings improved in FY26 compared to FY25. The Foundation’s Equity/Total Assets ratio stood at ~19.4% in FY26 (FY25: ~20.5%; FY24: ~18.9%), providing a cushion against unexpected losses. The sustainability of stronger coverage metrics will, however, remain contingent on continued collection efficiency, stable portfolio performance, and the Foundation’s capacity to replenish liquidity without materially compressing margins. Unlike the State Bank of Pakistan (SBP), which mandates Microfinance Banks (MFBs) to maintain a Capital Adequacy Ratio (CAR) of 15% of risk-weighted assets, the Securities and Exchange Commission of Pakistan (SECP) has no minimum capital adequacy requirement for Non-Bank Microfinance Companies (NBMFCs) such as Kashf.

Kashf Foundation issued a Rated, Secured, Privately Placed, Listed Term Finance Certificates (“TFC”) amounting PKR 2.483bln on December 08, 2023. The TFC has a tenor of 3 years and carries a profit rate of 3MK+1.5% p.a to be paid quarterly in arrears. The utilization of the loan proceeds is such that 70% of the proceeds have been utilized to issue micro-infrastructure loans directed towards the welfare of women and 30% to meet working capital requirements. As per client representation, the estimated amount is maintained in both DPA and DSRA accounts. As of June 08, 2026, a total of ten markup installments amounting to PKR 960mln have been paid. The most recent markup payment of PKR 29mln was made in June 2026. Principal repayments on the TFC commenced on March 8, 2025, and six installments have been paid as of June 2026.

The instrument is a Rated, Secured, Privately Placed, DSLR Listed Term Finance Certificate. It is issued as an Instrument of Redeemable Capital under Section 66 of the Companies Act, 2017. TFC is secured by specific financial mechanisms, including an exclusive lien on a Debt Service Reserve Account (DSRA) and a Debt Payment Account (DPA).

The TFC incorporates multiple layers of credit enhancement to mitigate investor risk: (i) The instrument is 100% principal guaranteed by InfraZamin Pakistan Limited. The guarantor also covers two quarterly interest payments, up to a maximum interest guarantee of PKR 350 million. The total Maximum Guaranteed Amount from InfraZamin is PKR 2,850 million. (ii) Debt Service Reserve Account (DSRA): Two Quarterly interest installments to be available in the DSRA at all times by the Company in a bank account which is under the lien of the Investment Agent, and the same will need to be maintained throughout the tenor of the loan on a rolling basis. (iii) Debt Payment Account (DPA): The Company will deposit one (01), (Interest + Principal) installment, seven (07) days before each payment date into the Debt Payment Account for onward payment to the TFC holders. Pre-default mechanism: If the amount maintained in DSRA becomes exhausted and the Company is unable to meet its debt repayment obligations as per the amortization schedule, a Cure Period of 30 days will be provided, within which the guarantor will make the payment according to the amortization schedule. Cure Period during which IZP will make the payments to TFC holders, a maximum of up to a guaranteed amount of PKR 2,850mln (outstanding markup + principal). IZP has the option to make the payments in accordance with the amortization schedule, or IZP may accelerate all principal payments to be paid to the TFC holders for early retirement of the outstanding principal amount.