The Future of Islamic Finance
Author
Smolo, Edib
Subject
Financial inclusionsustainability
sustainable finance
Islamic finance
Islamic sustainable finance
digitalization
financial technology (fintech)
harmonization
standardization
inclusive finance
Date
2024-11-07Metadata
Show full item recordAbstract
In this chapter, the integration of diverse discussions from preceding chapters converges into a comprehensive exploration of four pivotal challenges facing Islamic finance both presently and in the future. The chapter systematically addresses these challenges, commencing with a focused analysis on augmenting the role of Islamic finance in fostering financial inclusion. It scrutinizes innovative strategies to broaden access to financial services. Moving forward, the narrative navigates the intricate intersection of Islamic finance and sustainability, unraveling the potential synergy between these two domains and their collective contribution to Sustainable Development Goals (SDGs). The exploration extends to the realm of digitalization, probing how modern technologies such as artificial intelligence and blockchain can serve as catalysts for the progression of Islamic finance. Finally, the chapter delves into the imperative of harmonizing the Islamic financial industry (IFI), tackling challenges and proposing solutions to enhance uniformity and coherence in practices. These nuanced discussions not only address contemporary challenges but also underscore their critical role in achieving the SDGs and aligning with the targets of the Paris Agreement by 2030, providing valuable insights for scholars, practitioners, and policymakers in the field of Islamic finance.Department
FinancePublisher
Emerald Publishing LimitedBook title
The Future of Islamic Finance: From Shari’ah Law to FintechScopus Count
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Finance-Growth Nexus: Evidence from Systemically Important Islamic Finance CountriesPurpose The purpose of this study is to examine the effects of financial development on the economic growth of jurisdictions with systemically important Islamic finance. Design/methodology/approach The authors use several estimation methods. The primary analysis is based on the LSDVC method using a sample of 23 countries covering the period of 2000–2019. Findings The findings suggest that the financial sector may not be a significant factor in determining economic growth, or that it may decrease it depending on the proxy used. These results are in line with recent studies and robust across different estimation specifications and methods used. Practical implications Finance practitioners may reconsider the way they conduct their daily activities as their impact on economic growth is fading away. Similarly, policymakers should consider the role that financial development plays in economic growth alongside other factors that may influence its impact. It may be necessary to examine the moderating effects of institutional development on the relationship between finance and growth and consider the channels through which financial development can contribute to economic growth. Additionally, it would be useful to study the impact of Islamic finance on economic growth using different data sources. Originality/value Although the topic has been explored using different data sets and focusing on different samples, it has not been explored considering the impact of Islamic finance development on economic growth. Given the global appeal of the Islamic finance industry, it is worth investigating its significance for economic growth.
