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Introduction
As most of you are aware any Islamic financial initiative without
Compliance Options
In house Shariah Board or Out sourced
Contracted Scholars or Advisory Firm
The benefits of a Shariah Compliance consultancy are many fold and
Product Range
To a large degree, most of the products in use until very recently,
Product Range
Now there are structured products, capital protected
Scholars
The investors look to see who comprises the Shariah Board of the
Conflicts of interest
The formation of an independent Shariah compliance consultancy
Secondary Market
The secondary market is ripe for the regional banks to concentrate
asked over and over. The chances are slim as high debt ratios and
debt trading is not permitted.
Retail Banking
The retail sector is the future as a broad based clientele is essential
and this exists in the Islamic regions. Here also, the distribution
capabilities of the regional banks outstrip the reach of large western
banks. This is a perfect match for the two arms of Islamic banking to
be working together and, in time, there will be a balance reached
with the development of expertise and credibility of the local
regional institutions. The regional banks are smaller compared with
the Western giants but provide a much needed capability and here the
perception held of the Western banks will, in due course, be
overcome.
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Clientele
The clientele is growing as more institutions start to offer more
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Proposed Initiatives
If any one is planning on launching an Islamic finance initiative of
any kind then they should ensure that they acquire good advice and
by that I mean what I feel are the essentials for a successful and
competitive product. Lawyers, Bankers and predominantly Shariah
Scholars, all of whom must be competently familiar with Islamic
Finance.
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Next Steps
The appointment of a Shariah Board as early as possible in the
The customers are going to look for Shariah Scholars of repute and
ensure that they are Shariah compliant. Then only can the product be
launched. The Scholars need to monitor the on-going Shariah
compliance of the product by random review of the application of the
terms agreed with the financial institution.
Conclusion
In conclusion, I would like to again state that you must ensure that
you get a good Shariah Board with the experience and knowledge of
Financial products along with Lawyers and Bankers who are familiar
with Islamic Finance. The market is growing rapidly and needs a
commitment from financial institutional entrants with relevant
products.
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Thanks
Majid Dawood
CEO
Yasaar Limited
DIFC Gate Building
P.O. Box 121208
Level 12
Dubai, U.A.E.
www.yasaar.org
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