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Muslims worldwide are directed to avoid certain types of
banking products and investments due to the involvement of
Riba/Interest and they are more interested in dealing with
Islamic Banks for Riba-free banking products.
The demands of Islamic banking and Islamic insurance
products have been increased in past few years and these
products and services are being introduced by well-known
financial institutions. In addition to that, large numbers
of new Islamic financial institutions are being introduced
internationally, who requires qualified human resources for
the proper execution of Islamic Financial system, within
their organizations.
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At the international level, Islamic banking caught the attention of the leading financial institutions after the global oil boom in 2003. Big banks the world over saw the oil-rich Arabs as a lucrative untapped market. And given that they predominantly prefer to earn profits on their money through Islamic modes of financing, foreign banks had to develop new Muslim-friendly products.
Although many Muslim countries adopted the Islamic banking system decades ago, the system really flourished after 9/11. It is believed that many wealthy Muslims withdrew their deposits from western banks and transferred their holdings to banks in Muslim countries. In an attempt to halt that outflow, banks in the
 UK, USA and European countries turned towards Islamic banking.
There is an Islamic financing boom going on these days worldwide. Either entirely new Islamic banks are being opened or existing commercial banks are starting subsidiaries or branches specializing in Islamic banking. These financial institutions now offer Shariah-based alternative products like Murabaha, Musharakah, Ijarah, Ijarah-Wal-Iqtina and Modaraba to those in the conventional western banking system.
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From Standard Chartered Bank to Citibank and ABN AMRO, every major international bank is offering products based on Islamic banking principles.
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Islamic banking is the fastest growing sector in banking, internationally. It is believed that its annual growth is between 15 - 20%.
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Based on latest research, assets of Islamic banks worldwide are estimated to be between US$350 to almost 700 billion. Total about 50 to 60 countries across the world are using the Islamic mode of banking.
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 The average annual growth rate of IFSI assets during the 1995–2004 period is estimated to have been 15–20%, according to various sources. The future outlook for the IFSI can be summarized based on the past developments and present status of the industry.
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Assuming that IFSI assets were worth US$700 billion in 2005 and an annual growth of 15% until 2010, the IFSI could grow to US$1.4 trillion by 2010 and to US$2.8 trillion by 2015.
The integration of the IFSI within the existing financial system, or even the transformation of the latter into a full-fledged Islamic financial system, will continue at different paces across jurisdictions – in particular, among IsDB member countries.
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By 2015, a significant proportion of financial services provided are expected to become Sharia’ compliant in the Gulf Cooperation Council (GCC) region. Among South Asian member countries, this Shari[ah -compliant proportion is expected to constitute 15–25% of the total financial services provided. However, in some other countries, the proportion may remain as low as 1–2% unless the population becomes more aware of the benefits of having Islamic financial services as an alternative.
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It is expected that in several Western jurisdictions, non-bank Islamic financial services, particularly mortgages, will continue to grow on condition that the relatively more sophisticated clients remain convinced of the credibility of the Islamic alternatives and the regulators pursue the principle of “social inclusion” as a
part of the goals of the financial sector.
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 The Islamic banking sector is considered to be one of the largest growing sectors and a major revolution for the financial industry. Today, more than 350 Islamic financial institutions are operating in more than 61 countries, worldwide. The clientele are not confined to Muslim countries but are spread over Europe, America, South Asia, Far East, Africa and Australia. The financial experts seem a definite growth in the industry worldwide due to its assets based securities.
“Islamic banking transactions are about the transactions must be backed by underlying assets. The asset-backed securities that are so prevalent in the U.S. market fit in well with Islamic banking principles – as long as the assets are Islamically acceptable. The trend in the Islamic banking industry is to develop asset-backed securities as Islamic investment vehicles. In fact, the latest product that we have introduced is a liquidity management product, which is structured as an asset-backed security using U.S. lease assets,"
The Washington Times – March 21, 2000
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Participants' Comments |
 I
worked 15 years in a conventional bank. Then I decided to join
Certified Islamic Banker program at AIMS. This certification was
recommended to me by a friend. What attracted me to this program
was its diverse objectives and curriculum. I think that the best
thing about training is its comprehensive curriculum. Lectures
are challenging but very resourceful and helpful. Faculty
comprise of renowned practitioners of Islamic Finance industry
and they deliver good knowledge of the subject. Currently I am
working as a department head, in an Islamic Bank in Bahrain.
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AIMS
provides an excellent opportunity to learn Islamic Financial
System & manage
Islamic Banking. CIFE training at AIMS is full of knowledge,
and explains a best way to practice Islamic Banking and
Finance. I have worked with many professionals in Islamic
Finance industry, (and as per my personal experience, most of
the
working professionals do not understand the technicalities of
the subject). CIFE certification gave me an understanding of
real Islamic Banking and right way to solve the technical
problems. This is taking my position upward, unlike others. |
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Industry Growth |
The
growth of Islamic banking will create a virtuous circle. As
the industry grows, competition will force Islamic banks to
provide products with risk/return profiles that are comparable
to their conventional counterparts. This will create a big
shift, a transfer of funds from the conventional to the
Islamic system. It will have an exponential effect on our
industry. |
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Yearly
growth of Islamic Finance industry is estimated as 20%. By the
end of 2007, Islamic Finance industry will require 2.4 million
skilled professionals, globally. |
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