Islamic finance will benefit from infra spending: Minister

H E Ali bin Ahmed Al Kuwari, Minister of Commerce and Industry said yesterday that Qatar’s growing Islamic finance industry can hugely benefit from the country’s infrastructure spending, particularly in the 2022 World Cup projects. He encouraged Islamic banks in the country to take advantage of the modern technology in order to reduce cost.

Delivering the opening address at the 5th Doha Islamic Finance Conference, the Minister said with Qatar’s growing Islamic banking assets, the country is currently the fifth largest Islamic finance market in the world.

According to the Minister, Qatar’s Islamic banking assets of $120bn with growth rates of more than 10 percent, is fifth largest in the world. Islamic banking assets also constitute 26 percent of the total banking assets in Qatar, the Minister added.

In his speech, the Minister also reiterated that the country was one of the most stable economies in the region, noting that the IMF expects the country’s GDP to rise to 3.1percent. He also highlighted the growth of non-oil sector in Qatar with a growth rate of 6 percent in the first half of 2018.

In a study, it was said that financial technologies (fintechs) have the potential of cutting the cost of providing financial services by 80 to 90 percent.

With this, the Minister said, that fintech plays an important role in reinforcing the Islamic sector to compete with conventional banks, as well as in keeping up with international markets.

The Minister also expressed his trust in Islamic institutes’ ability to rub shoulders with changes in technology while complying with Shariah standards.

Also speaking during the event, Minister of Endowment and Islamic Affairs HE Dr. Ghaith Bin Mubarak Al-Kuwari, stressed the need for Islamic banks to update their technology far beyond the technologies available in traditional banks; and to work on zero tolerance to errors.

In his speech, Barwa Bank Chairman & Managing Director Sheikh Mohammad Bin Hamad Bin Jassim Al-Thani, said the bank is aiming to reach a complete digital transformation as part of their five-year strategy. He said the bank, which is diversifying its services and products, has also identified digital technology services as one of its priorities.

During the event, Islamic finance experts also discussed the experience of central banks in their transformation towards digitalization, the risks and requirements in setting up a digital Islamic bank, the role of fintech in digital economy and sustainable development, and the challenges in electronic systems in Islamic banks.