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Islamic finance, or Shari’ah compliant financing (SCF), is one of the fastest-growing segments of the global financial system, particularly in the Middle East. In Saudi Arabia, the total assets for the Islamic finance market have exceeded $830 billion, making the country the leader in this sector.
The chief of the Saudi Central Bank, Ayman Alsayari, noted that the kingdom is the largest Islamic finance market and has been witnessing robust growth over the past few years.
Speaking at the Islamic Financial Services Board (IFSB) symposium in Riyadh, Al Sayari said the total value of the Islamic finance sector boasts $2.9 trillion, with an average growth of 9.6% spanning over the last three years.
“Saudi Arabia has a deep-rooted and historical relationship with Islamic finance. It houses the largest Islamic finance market in the world. The Islamic banking sector alone accounts for 33% of the global Islamic bank assets,” says Al Sayari at IFSB. During the meeting, the board members also spoke on the future of Islamic finance amid global economic strife and tight financial conditions.
The governor noted that the kingdom is similarly the largest sovereign sukuk issuer globally. The cooperative insurance sector of Saudi Arabia is also the fastest growing in the world, with a growth rate of 27% in 2022.
Market intelligence has also looked favorably upon Shariah-compliant funding in the past six months. In May, S&P Global Ratings said the Islamic finance industry is expected to grow by nearly 10% in 2023.
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