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Fintech and the Growth of Islamic Finance

13 Oct 2021 | Wednesday Source : Bloomberg Tax

Global Islamic finance exerts considerable influence in the international banking sector. Forecasts from 2020 estimate that the total value of global Islamic finance assets will reach $3.69 trillion by 2024, with the sector posting 10.6% growth in 2020. While this may already seem an impressive figure, the reality is that Islamic finance is still finding its footing.
When we talk about Islamic finance, we are referring to all transactions and activities that adhere to Sharia principles. Conforming to these principles includes the prohibition of investments that profit from debt, such as products linked to interest payments. There are also sectors that cannot be invested in, such as alcohol, tobacco, gambling and “adult entertainment.” Finally, Islamic finance encourages asset-backed financing.