Islamic finance has become a force to be reckoned with, with the global Islamic banking & finance industry swelling to over US$2 trillion in assets in 2017 and is expected to surge to US$3.8 billion by 2023, according to the latest State of the Global Islamic Economy Report 2018/2019.

Not wanting to be left behind, Singapore is taking a proactive approach by launching a new Shariah-compliant index that will serve as a benchmark for Shariah-compliant funds looking to invest in the city-state.

According to Chan Kum Kong, SGX’s head of research and products, “In Asia, where the Islamic finance industry has grown substantially over the last two decades, the appetite for Shariah-compliant products continues to build. This growth momentum is attributed to Asia’s large Muslim population, strong economic and financial fundamentals, a large investor base, as well as strong government support.”

Malaysia is still viewed as the leader in Islamic finance market according to the State of the Global Islamic Economy Report in 2016. This is due to its large asset base, advanced governance, and by far the highest awareness scores.

The figures below show the major growth opportunities and challenges in Islamic Finance, according to the same State of the Global Islamic Economy Report in 2016.

Source: Business Times, State of the Global Islamic Economy Report 2018/2019, 2016.