INCEIF Knowledge Repository (INCEIF University)
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Islamic capital market for social development: innovating waqf mobile sukuk in Sub-Saharan Africa
No full textThe use of sukuk in social development is an under-researched area, especially in the context of Sub-Saharan Africa. Although the Kenyan government has issued the world's first mobile bond and the Indonesian government has used mobile platforms as a distribution channels for the issuances of retail sukuk, little is known about mobile sukuk and its potential from the perspective Islamic social finance. This paper aims to explore the opportunities and challenges of mobile sukuk for social development, namely perpetual waqf mobile sukuk, where the concept of waqf is combined with qard. It is anticipated that the proposed type of sukuk has the potential to be used as an Islamic social finance instrument
Lessons from COVID 19 - what the virus has taught us
No full textThe traditional view, of a linear relationship between the development levels of countries and their ability to deal with problems has been completely changed with the coronavirus disease 2019 (COVID-19) pandemic. The countries hit hardest by the pandemic have been the so called developed ones of Western Europe and the USA. Equating development to mega cities has been shown to be misplaced. The pandemic has spread fastest in crowded cities such as New York and Los Angeles. Aside from overpopulated cities, ignoring the environment and the need for healthy living conditions are other important reasons for their failure to control the epidemic. Yet, countries such as Taiwan, South Korea and Japan have had very low infection rates relatively, even though most of their populations live in large urban centers. The difference may be due to the extensive practice of using face masks in these countries. The need to emphasize and rely on science and technology to solve the problems of humankind is among the key lessons that the pandemic has taught us. A final lesson the virus has taught us, is that regardless of which country we live in, our well-being and destinies are closely indeed intertwined. A health care crisis anywhere in the world can affect us all and very quickly too
Is there a diversification "cost" of Shari'ah compliance? Empirical evidence from Malaysian equities
No full textIslamic equity portfolios work with a smaller investment universe given the filtering of non Shari'ah compliant stocks. It has been theoretically argued that this culminates in suboptimal portfolio diversification, which in turn adversely affects risk-adjusted returns. We offer empirical evidence that such a conceived portfolio diversification "penalty" is far from a foregone conclusion, at least empirically. Our results tend to indicate that Islamic portfolios are not invariably handicapped in terms of portfolio diversification. We also explored dimensions that may account for differences in the relative investment performance between Islamic and conventional portfolios, such as portfolio constraints, short selling and market conditions. We believe this paper is among the first to apply substantial empirical analysis specifically with respect to the portfolio diversification perspective on Islamic equity investments
Application of precious metal-backed cryptocurrency in Islamic finance
No full textFinance industry has become an essential part of the digital transformation in the perspective of Industry 4.0. The objective of this research is to find out the prospects of applying precious metal-backed cryptocurrency (PMBC) to Islamic finance by exploring its application to the different Islamic finance contracts for structuring Islamic finance products. A qualitative methodology is employed in conducting this research where relevant literature on the subject matter was reviewed. By using doctrinal approach, the paper presents Shari'ah compatibility of and issues in application of PMBC to Islamic finance contracts. The outcome of the research reveals that there is scope to use PMBC backed by gold to replace the function of fiat currency in Islamic finance contracts. However, there are specific Shari'ah rules applicable to each of the contract as derived from AAOIFI's Shari'ah standard No. 57 published in 2016. For the sustainable development and practical implementation of PMBC in Islamic finance, it is observed that there are certain inhibitions that need to be eliminated such as lack of political will in acknowledging it as a legal tender and development of an adequate and effective infrastructure with legal, regulatory and governance frameworks. It is anticipated that the outcome of this research will assist the policymakers and stakeholders of Islamic finance to prepare themselves to utilize PMBC in Islamic finance industry and to conduct further research in resolving the issues identified for adoption of PMBC backed by gold in a Shari'ah compliant way
Zakat & women: from receiver to givers
No full textZakat is the third pillar of Islam. Zakat received from eligible persons is paid to the legal recipients of it, as mentioned in the Qu'ran (9:60). The legal recipients of zakat are of eight categories and there is no priority given to a specific gender. As long as the person falls within any category of the 'legal recipient' irrespective of gender, the person is eligible to receive zakat. Against this backdrop, this article focuses on how zakat could be used to empower women who are eligible to receive it
Maldives Islamic Bank announces dividend for 2020
No full textMaldives Islamic Bank has announced via a press release dated the 26th April 2021 that its board of directors, via the board resolution on the 25th April 2021, has recommended a cash dividend of MVR27.56 million (US$1.78 million) equivalent to MVR1.23 (7.94 US cents) per ordinary share for the year ended the 31st December 2020, subject to the final approval of shareholders at its forthcoming annual general meeting
Spearheading corporate sustainability transformation in banking industry: case study of CIMB Group (CIMB Bank Malaysia and CIMB Niaga Indonesia)
No full textSustainability issues, like growing inequality and the deterioration of natural livelihood make the transformation to a more sustainable economic system increasingly desirable and emerging. Moreover, the world is now dealing with unstoppable effects of global warming such as rising sea level, extreme temperature inclination, unpredictable flooding, scalable wildfire, and social economic problems such as income inequality, multidimensional poverty, difficulty in accessing basic education as well as health facilities. Thus, sustainable development calls for integration of the triple-bottom line namely environmental protection, economic empowerment and social inclusion to all sectors of society including the corporate sector and their relevant organisations, commonly phrased as corporate sustainability transformation and ESG integration. Moreover, organisations are increasingly being reminded that their policies and practices are likely to contribute to heightened social disparity and environmental degradation. They have started to adopt and transition to fundamental elements of sustainability into their business practices either as compliance or as stewardship beyond compliance. They also understand the need to drive business change, advocate for policy shifts towards sustainability, develop fine-tuned sustainable business model innovation and exemplary ESG standards by implementing holistic corporate sustainability transformation as their core organisational strategies and guiding principles. This study is an attempt to investigate and assess how the drivers of change theory introduced by Burke and Litwin shapes the dynamics and implementation of corporate sustainability transformation in the last four years at CIMB Group. This paper employs the case study approach to validate and verify the actual findings linked to the theories and concepts. Primary data were gathered through a series of in-depth interviews with Sustainability, ESG Integration and Islamic banking experts from both CIMB Malaysia and CIMB Niaga Indonesia. Secondary data is also undertaken to substantiate the research findings by way of employing content analysis through publicly available CIMB Group sustainability-related information
COVID-19 and Islamic social finance
No full textIt is said that the COVID-19 pandemic has turned back the poverty clock. As such, there is a need to have social mechanisms put in place to provide relief to those who are affected in this regard. Islamic social finance consists of tools and institutions that could be used to alleviate poverty. This book explores the impact of COVID-19 on Islamic finance to better understand the effectiveness of Islamic social finance in helping those who have been affected by poverty overnight due to the halt in all major economic activities in the context of the pandemic. Since the struggle against poverty in each country will be different, the book attempts to shed light on the experiences of different countries by presenting successful models of Islamic social finance. The book first looks at poverty and COVID-19 before delving into the role of Islamic social financial institutions and how they have risen against COVID-19. The book concludes by examining the impact of COVID-19 on Islamic microfinance. This book is the first of its kind on the subject of COVID-19, and it intends to bridge the gap in the literature
Economic empowerment of women: exploring financial inclusion and economic growth
No full textWomen consist of almost half of the world’s population but are disadvantaged in all human development fields. They face barriers in access to valued resources which include education, health, employment, access and ownership of land, banking and finance. Despite recent advances in important aspects of the lives of girls and women, pervasive challenges remain, most often as a result of widespread constraints which often violate women's basic human rights. These differences matter as they directly affect economic outcomes. We therefore make the economic empowerment of women the focus of this study. Research on women’s economic empowerment can be approached in several ways. We look at two very basic and essential aspects; financial inclusion and economic growth. First, we gain insights into the gender gap in the economic empowerment of women through the financial inclusion lens. Second, this study explores women’s economic empowerment and its relationship with economic growth. We address the first issue in two ways. First, at the micro-level by focusing on a data set of 6,000 individuals from the country of Pakistan. The country represents not only a Muslim majority country but also ranks amongst the lowest in women empowerment indicators. Second, we look at the status of financial inclusion of women on a global level by focusing on data of 140 countries and segregate the data from the World Bank and United Nations on women for 42 OIC member countries and 108 developing countries in order to compare. For the second issue we look at the relationship between economic growth and women’s economic empowerment with the data for OIC countries and developing countries from the same sources with additional indicators on Political Risk from ICRG
Structuring fund for affordable housing investment in Malaysia: an exploratory research
No full textThe purpose of this study is to explore potential fund-raising option that can be developed to attract investment in affordable housing initiatives in Malaysia. In doing so, the study undertakes to discuss the viability of the property trust fund structure as an investment vehicle. The study uses a qualitative design that involves the use of semi-structured questionnaires as a data collection strategy. A total number of ten experts were selected for the interview using critical case sampling scheme based on the purposive sampling strategy. The study discovers that a dynamic fund structure - one that allows for the fund to evolve with changing circumstances and needs - can be adopted. This fund structure comprises a fund that can be initially established as a closed-ended fund. Then, with sufficient track record, the fund can be transformed into a public real estate investment trust, with the prospect of tapping into capital market via issuance of sukuk in the future. The fund can also adopt mezzanine structure of funding, which may reduce investors' risks with minimal government intervention