Qatar has been working to assist the ecosystem for Islamic fintechs. Highlighting the position of expertise within the Islamic finance throughout an internet occasion, specialists stated fintech corporations have an vital position as they bridge the hole within the Islamic finance sector. Panelists mentioned in regards to the ecosystem to assist SMEs with options to scale up halal economies and promote Qatar as an Islamic fintech hub regionally and globally throughout an internet occasion.
HBKU in affiliation with Qatar Monetary Centre (QFC) organised a webinar entitled ‘Islamic FinTechs and the Halal Financial system’ which make clear the alternatives of halal economic system that was $1.9 trillion in 2020 and anticipated to achieve $3.2 trillion by 2024 which creates great alternatives throughout numerous segments of halal economic system from meals, cosmetics, style to journey.
Akber Khan, Senior Director of Asset Administration at Al Rayan Funding, stated the present occasion alternatives within the Islamic finance house is that fintech is in search of to bridge that hole that exist presently within the Islamic finance trade and brings extra alternatives for fintech options. Round 20 p.c of world’s inhabitants is Muslim, but Islamic finance trade as a complete is at most 5 p.c of the worldwide monetary trade so there are alternatives in each doable space. There are alternatives in corporations in search of to service the Muslim inhabitants. The benefit that fintechs have that they’re able to leap from the extra conventional corporations who depend on conventional technique of entry to a buyer. Expertise is an enabler of permitting distribution throughout geographies in a short time.
Talking about sustainability Khan elaborated that there’s an overlap between ESG and the ‘S’ of the sustainability half and there’s an overlap between Shariah compliant investing and ESG which comes within the social ‘S’ facet of it.
“Socially accountable investing is what we do, and we additionally have a look at sustainability facet from an Islamic viewpoint as a result of we can not spend money on corporations that are excessively leveraged. Having a reasonable quantity of debt helps sustainability via an financial arrange. The important thing facet of Islamic finance is inherent inside its sustainability, so sustainability is essential,” he stated.
Responding to a question, will enterprise capital funds for fintechs in Qatar scale up and promote innovation for halal economic system in Qatar, Khan famous, “I believe there’s room for a number of traders and if there’s a fund that has a mixture of each public and the personal sector that may be nice. To scale the market and suggest extra modern options and different gamers becoming a member of in type of VCs or some other type will likely be useful.”
Ayman Doukali, Head of Islamic and Structured Finance at Qatar Monetary Centre (QFC) Authority stated, “4 to 5 years in the past no person heard of banking as a service or open banking which is bringing basic modifications not solely the best way financial institution operates monetary establishments together with each banks and fintechs.”
Addressing a question about Islamic fintechs having an ambition to develop geographically and concerns for fintechs as they transfer from market to market, he stated, “I believe from the start there must be a transparent understanding of you as a fintech or a tech firm or an enterprise and when you’ve got lined your native market sufficiently earlier than you begin trying to develop overseas.”
Talking about what position regulators, supervisors and legislatures can play to facilitate adoption of fintech in Qatar Doukali famous, In Qatar for the sector to flourish there must be a transparent jurisdiction agenda when it comes to what is required in laws. “There’s a nice want of clear guidelines and laws throughout the completely different facets of fintech, be it digital belongings, open banking and so on.
Relating to the success of fintechs he burdened that there’s a nice deal with retail phase and cost processing but when “we’re speaking about monetary inclusion from the sectors perspective there’s quite a lot of work that may be completed on the wholesale facet, personal banking and SMEs which permits improvements, unlocks further pockets of liquidity and modifications the best way for the SMEs to finance their companies. So, that is an space for enchancment from a fintech perspective.”