A Modaraba can undertake any business activity or offer any financial product based on Islamic concept, provided it is Shariah-Compliant and has the approval from the Religious Board.
The funding and financial facilities provided by Modarabas have to be designed in Shariah-Compliant mode, which is mostly similar to the products offered by the Islamic banks.
No Modaraba can operate in Pakistan unless its business and prospectus are cleared from the Religious Board.
The prospectus and all products and business activities of a Modaraba are required to be approved by the Religious Board, which is facilitated by the Modaraba Wing headed by the Registrar Modaraba (Executive Director), Securities and Exchange Commission of Pakistan.