Pakistan is facing great challenges of terrorism which have posed serious threats towards integrity and stability of the country. It is unanimously agreed that finance serves as lifeline for execution of terrorist activities. Terrorist groups generate funds through multiple sources and transfer them by exploiting the loopholes existing in financial system. Despite, Pakistan has taken sufficient steps to counter the financing of terrorism (CFT), nonetheless, money is still transmitting due to some regulatory flaws of the financial system. Owing to terrorist financing related deficiencies, Pakistan has been placed on the Financial Action Task Force (FATF) “Grey list”. FATF has warned Pakistan to be blacklisted if precipitate actions to address TF related deficiencies are not taken until February 2020. The paper evaluates the present CFT legal framework and recommends certain legal initiatives required to be taken by Pakistan prior dead line of February 2020.