Kuala Lumpur: The sustained effort to enhance the regulatory and legislative framework to support Islamic financial transactions will continue to place Malaysia as the biggest in the global Islamic banking industry, says CIMB Islamic Bank Bhd.
Chief Executive Officer Badlisyah Abdul Ghani said despite the growing competition from other markets, such as Indonesia and Saudi Arabia, Malaysia's better and firm framework would be a value added.
"You will see a lot jurisdictions getting bigger and bigger in Islamic banking in their respective financial markets.
"But Malaysia will continue to be significant because we are leading in terms of the infrastructure being put in place," he said on the sidelines of the just ended 19th Malaysian Banking Summit here.
Badlisyah was a speaker at a panel discussion on "The Future of Islamic Banking: Where Do We Go From Here?" Malaysia already has over 60 per cent market share of sukuk and nearly 25 per cent of the world's Islamic banking assets.
Muslim countries, which have a combined 76 per cent share of the global Islamic banking market, include Qatar, Saudi Arabia, the Arab Emirates, Malaysia, Pakistan and Indonesia.
Nevertheless, Badlisyah said due to the aggressive external environment, Malaysia should always come out with compelling, commercially driven products, to clearly distinguish itself from competitors.
Another speaker, Hong Leong Islamic Bank Bhd Managing Director/Chief Executive Officer Raja Teh Maimunah Raja Abdul Aziz said the future lies in the digitalisation of Islamic banks, as banking is set to evolve towards technology-based, service-driven value propositions.
"In terms of digitalisation, there are some pockets of development already in Malaysia, as all banks are offering banking and mobile banking," she said.
Hong Leong Bank earlier this year rolled out a mobile-to-mobile payment system which facilitates cashless and cardless transactions and lowers the cost of doing business particularly for merchants.
"That said, we have to take mobile banking a little further than just payments and transactions and allow people to even borrow money," Raja Teh Maimunah said.
Another development discussed by the panel was the role and future of crowdfunding, and how it could be the next driver of Islamic financing.
Raja Teh Maimunah said the crowdfunding financing platform will support local capital projects and allows entrepreneurs to rise and encourages innovation.
The laws pertaining to crowdfunding have just been introduced by the Securities Commission Malaysia, which awarded six licences to local firms to start their operations by year-end.
(Daily Express / 20 June 2015)---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com