Cohesive Efforts Needed By Islamic Finance Players, Says Bank Negara

KUALA LUMPUR, Nov 21 (Bernama) -- More cohesive efforts by industry players across all sectors in Islamic finance are needed to realise the industry's virtues that uphold social justice, equality, economic prosperity and inclusivity, Bank Negara Malaysia (Malaysia's Central Bank) said. Deputy Governor Abdul Rasheed Ghaffour said industry players should not only play a proactive role to enhance collaboration within the industry but also extend it beyond sectoral boundaries. He said through these collaborations, industry players would not only realise the Islamic finance virtues but also push the industry's growth trajectory into the next level of maturity. "Collaboration beyond traditional sectors and into competitive industries, such as retail, communication and oil and gas should be advanced as it opens up and extends our outreach to form new alliances," he said in his keynote address at the 13th Kuala Lumpur Islamic Finance Forum here Monday. He said joining forces with other industries would allow Islamic finance to embark on a faster learning curve, while equipping the industry players with new skill sets. "This will enable the intended business objectives and outcomes to be met within a short period of time," he said. Abdul Rasheed said another area that could drive the future growth of Islamic finance is the acceleration of innovation by Islamic financial institutions. He said embracing and embarking on digital innovations opens up new and ample opportunities for industry players to re-ignite productivity growth and increase efficiency of processes. "Technology will certainly redefine the future financial landscape and fintech is progressing by leaps and bounds in the conventional sphere and rapidly changing consumer behaviour and needs," he said. He said Islamic finance, being a relatively young industry, has vast opportunities to leverage on technology as a catalyst to scale up businesses and enhance operational efficiency. He added that this includes understanding the potential of blockchain technology and its associated risks to enable its effective adoption that is both cost- and time-saving. Apart from that, he said successful outcomes in key growth areas require the availability of multi-skilled and top-notch talent in the industry. "In Malaysia, we have over 26,000 talents in the Islamic banking industry and a holistic infrastructural ecosystem that supports their developmental needs. "As we move forward, we need a deep talent pool with a wider set of competencies beyond the scope of Islamic finance knowledge to provide the additional competitive edge to the industry," he said. He added that continuous nurturing of Islamic finance talent, with intellectual diversity in other related disciplines such as economics, finance, law and financial technology, could give rise to new visions and wisdoms that go beyond traditional boundaries. On another development, he said a regional platform, namely the Islamic Infrastructure Investment Platform (I3P), is currently being developed and is at the proposal stage. He said through this regional dialogue platform, collaboration might be fostered among financial institutions, regulators and ministries from Asia-Pacific Economic Cooperation (APEC) economies with multilateral institutions and academic experts to explore measures that can expand cross-border investments by Islamic financial institutions. "In particular, the potential for Islamic pension funds and Takaful to finance infrastructure projects in APEC economies can be explored," he added. -- BERNAMA