Doha: The fourth IFSB Innovation Forum for market players in the Islamic Financial Services (IFSI) industry kicked off on Wednesday under the auspices of the Qatar Central Bank (QCB) in collaboration with the Council of Islamic Financial Services (IFSB) based in Malaysia and the Qatar Financial Center (QFC).
Under the theme “Innovations for Sustainability and Regulation of Financial Services”, the 4th IFSB Innovation Forum brought together many specialists and people interested in international Islamic and sustainable finance.
In a speech at the inauguration of the forum, HE the Governor of the Central Bank of Qatar, Sheikh Bandar bin Mohammed bin Saud Al-Thani, said that the Islamic banking assets of four Islamic banks in the State of Qatar amounted to $154 billion in June 2022, representing 28% of banking assets.
His Excellency added that the latest IFSB report ranked the State of Qatar among the top five countries in the Islamic finance industry thanks to its strong regulatory and supervisory policies that adhere to relevant international standards.
The report is also ranked as systemically important among the 15 countries where Islamic banking has achieved more than 15 percent market share, His Excellency noted, attributing the results to four decades’ experience of the state of Qatar in Islamic banking.
The country’s banking sector continues to play an important role in driving economic growth and meeting infrastructure financing requirements for the FIFA World Cup Qatar 2022, to be held on November 20, His Excellency said, noting that QCB’s dual banking system ensures a level playing field for Islamic and conventional banks in Qatar, and aims to develop a regulatory framework that promotes growth and innovation in the financial sector, and is committed to playing a leadership role leader in the development of the financial technology ecosystem in Qatar.
In this regard, His Excellency noted that digital transformation and climate change have recently attracted the attention of the real economy, the financial sector and the private sector, transforming the role of banks and central banks in the services sector. financiers into a role that empowers the market. , digital acceleration and innovation. His Excellency added that both areas fall under the Qatar National Vision 2030, highlighting the digital transformation strategies launched by national banks that demonstrate the importance of financial digitization as the future of the banking sector.
His Excellency highlighted QCB’s multiple initiatives ahead of the upcoming FIFA World Cup to enable secure, fast and affordable digital payments, including its first license in the country to provide digital payment services by launching Google Pay last month. in Qatar. On the regulatory front, the QCB has issued several guidelines that regulate and license various payment activities in the country, His Excellency pointed out.
His Excellency added that the growing importance of environmental sustainability and social responsibility makes more urgent the need to rebuild the world with sustainable and environmentally friendly investments. Qatari banks have already embarked on the transformation to green banking by issuing green bonds, setting up green loans and increasingly standardized ESG disclosures.
His Excellency further pointed out that the global financial system has witnessed unprecedented developments over the past two decades, intensified by the continued challenge faced by financial regulators to deal with a wide range of issues ranging from unconventional monetary policies following the unprecedented COVID-19 global financial crisis. pandemic scenarios, His Excellency said, calling for collective action to achieve new benefits amid the challenges of digital transformation and green finance.
IFSB Secretary General Dr. Bello Lawal Danbatta said global Islamic financial services industry assets grew by 11.3% year-on-year with an estimated total value of 3 .1 billion in 2021, explaining that the progress made by the Islamic financial services industry, despite the challenges imposed by the COVID-19 pandemic, is a testament to the growing interest in Islamic finance products and services among broader financial sector stakeholders, including non-Muslim majority countries.
He clarified that many digital innovations in the Islamic financial services industry, launched during the pandemic, have not only helped Islamic financial services institutions to overcome the challenges of the pandemic, but also offered Islamic financial services institutions opportunities to popularize and expand the reach of Islamic financial services institutions. finance beyond traditional boundaries, with an increased interest in the possibilities of Islamic finance in developing sustainability-related products and services that are well suited to the Sustainable Development Goals and beyond.
Dr Danbatta added that an increase in demand for sustainability-related products and services has recently taken place, as environmental, social and governance factors increasingly attract the attention of global investors due to the protests. of climate change and the resulting risks for financing and management. investments made by financial institutions.
In this regard, he said that in 2021, the issuance of sustainability-related sukuk amounted to $5.3 billion, of which $1.6 billion or 29% green sukuk, and this increased interest has resulted in the large-scale issuance of sustainable and environmental sukuk, social and institutional governance sukuk from sovereign and private issuers.
He predicted that this trend will continue, given the strong commitment of global leaders and industry players to sustainability and climate-related initiatives, in addition to growing investor appetite for sustainable investments, and the need to finance green transformation and sustainability projects is likely to lead to increased issuance of sustainability-related sukuk in the near future; stating that Islamic FinTechs have the potential to significantly contribute to addressing sustainability factors and environmental, social and institutional governance through their innovative financing and investment ideas.
He reiterated that examples of this include charity, zakat and waqf funds collected through crowdfunding platforms to be used for activities eligible for climate finance, financial transfers through Islamic fintech that help families get clean energy Low cost.
The IFSB Secretary General explained that the Innovation Forum is an annual event organized by the IFSB which aims to develop creative thinking and dialogue in the Islamic financial services industry, as it focuses on the innovation that creates a competitive advantage for these institutions and helps promote the growth of Islamic finance.