Malaysia is widely acknowledged as one of the most promising Islamic fintech jurisdictions in the world. Its merits are undeniable: it boasts one of the most sophisticated Islamic fintech regulatory architectures globally, it has a tried-and-tested, successful topdown approach, and it houses a vibrantly creative Islamic finance community. The key is to harness this potential and translate it into tangible rewards to spur the national economy and benefit the global Islamic finance industry.
This ambition is aligned with the Malaysian government’s Shared Property Vision 2030 (SPV2030), which highlights Islamic finance and the digital economy as Key Economic Growth Activities to achieve its national commitment of elevating the country to become a nation of sustainable growth. This constant drive for innovation will also ensure fair and equitable distribution across income groups, ethnicities, regions and supply chains.
The Malaysian Islamic Fintech Initiative is a product of this ambition. Organized by Islamic Finance news and supported by Malaysia Digital Economy Corporation (MDEC), the Malaysian Islamic Fintech Initiative is the country’s leading industry-driven, high-level engagement series aiming to craft the national agenda on Islamic fintech, provide guidance and direction to the stakeholders and mobilize meaningful, actionable outcomes to develop the Islamic fintech ecosystem. With the input and support of regulators, government agencies, fintech start-ups, Islamic finance institutions and stakeholders from the third sector and investment community, a series of recommendations and action plans have been formed, contributing to the formulation of a high-level framework for Malaysia’s Islamic fintech industry.
Finding funding success
The Malaysian government has identified Islamic fintech as a strategic avenue to further bolster its global Islamic economic standing and as a source of economic growth. There is much to gain from developing this area. However, establishing a vibrant supportive ecosystem is a collaborative exercise involving many moving components, with funding as an instrumental factor of success for any start-ups.
The importance of a robust funding mechanism was highlighted during the first two dialogues under the Malaysian Islamic Fintech Initiative. A survey with 200 Islamic fintech start-up CEOs and founders from across the world conducted by IFN Fintech in June 2021 found that funding remains the biggest hurdle faced by Islamic fintech start-ups, a persistent concern that was also highlighted by the start-ups in 2020.
To address this perennial issue, the third instalment of the Malaysian Islamic Fintech Initiative focused on mobilizing funding for Islamic fintech start-ups, who find it twice as hard to secure funding due to a myriad of factors including a lack of Islamic finance awareness and understanding from investors. These prevent Islamic fintech start-ups to grow and scale up to serve the financial inclusion agenda. The closed-door dialogue was participated by international and domestic players.
DIALOGUE 1
Building Malaysia’s Proposition
• Crafted 10 strategic recommendations to position Malaysia as a regional Islamic fintech hub
• Identified Malaysia’s unique selling proposition and potential areas of leverage
DIALOGUE 2
Islamic Fintech & Digital Financial Inclusion
• Designed nine action plans for Malaysia to create a niche in being a leader in driving digital financial inclusion through Islamic fintech
DIALOGUE 3
Mobilizing Funding for Islamic Fintech
• Identified four key priorities and six strategic recommendations to facilitate an Islamic fintech funding ecosystem
Click here to download the full Islamic Fintech Dialogue Report