The Islamic finance industry is pegged to grow at 15-20 percent per year, said experts at a recently concluded Islamic banking conference in Muscat.

Sixty-three per cent of Islamic finance institutions are in the Middle East, controlling more than 50 per cent of Islamic banking assets, they added at the first ever Oman Islamic Banking Conference.

“Oman’s move to Islamic finance comes at just the right time as ethical finance gains a foothold around the world,” said Ihab Sahili, regional director for International Turnkey Systems, who hosted the conference.

“The speakers illuminated a number of key aspects of the industry and question time after each presentation was lively as delegates delved deeper into the topic. We are proud to be supporting the Omani banking industry in this important endeavor,” he added.

Speakers from prominent Islamic financial institutions around the region and high-level delegates from Omani financial institutions and banks gathered to discuss regional best practices and map out a strategy for the nation to become a part of the rapidly growing Islamic finance industry.

Dr Mabid Al Jarhi, head of Training at Emirates Islamic Bank, president of the International Association for Islamic Economics and member of the Shari’a Board on the Dubai Financial Market, stressed the need for creating a fruitful regulatory and legal environment for Islamic finance through creating separate tax and civil laws and financial regulations.

“The uptake of Islamic finance even in non-Muslim countries has shown that it is not simply a faith-based choice, but also a viable and ethical financial model,” he said.

“If Islamic financial institutions in Oman chart their own course, stay away from products of ill repute such as Tawarruq (cash-for-cash products), they could grow to become serious contenders in the regional Islamic finance industry.”

“Growth figures could match that of institutions around the world as funds that were invested in ethical institutions overseas will be repatriated,” concluded Dr Al Jarhi.

Dr Haroun Dharsey, senior vice president and head of Operational Projects and Support at Dubai Islamic Bank, gave a technological perspective on Islamic banking.

“While significant strides have been made in IT infrastructure rendering operations and service more efficient, stakeholders such as banks and technology vendors still need to invest more in Sharia up-skilling and training of staff,” said Dr Dharsey.

Haitham Abdo, Group marketing director from ITS, asserted that IT solutions needed to be highly flexible, as each Sharia board has different interpretations, leading to a high degree of variance in the structure of financial products.

Ethix, ITS’ financial solution, allows a great degree of flexibility as almost no parameters have been defined, save the removal of interest. It also reduces total cost of ownership, operational costs and risks, Abdo said. – TradeArabia News Service