Digital Transformation in Islamic Finance

The ongoing digital transformation is shaping the Islamic mode of financial intermediation and the impact on the faith-based financial mode has been multifaceted. This has raised a host of interesting questions: what is the degree of penetration of Islamic finance in the fintech industry? Are Islamic financial institutions (IFIs) or banks ready to embrace fintech? Is fintech an enabler or barrier to achieve the intended purpose of Islamic finance? Will technology narrow the division between Islamic and conventional finance in the future? These are existential questions for Islamic finance and the book endeavors to examine the impact of financial technology on the industry.

The book assesses various fintech business models and how they could be a threat or an opportunity. It also examines whether fintech provides IFIs an edge to serve clients following the Shariah norms and how the adoption of fintech in the Islamic mode is required for meeting the maqasid Al Shariah. The book discusses applicability of fintech like blockchain, digital currency, big data, and AI to different branches of Islamic finance.

This book will interest students, analysts, policymakers, and regulators who are working on Islamic finance, financial economics, Islamic economics, and development finance.

Table of Contents

Introduction, Yasushi Suzuki and Mohammad Dulal Miah Part I Theoretical and Philosophical Speculations on Digital Transformation in Islamic Finance 1. Digital Transformation in Islamic Finance: A Critique of Perfectionist’s Views on Islamic Fintech, Yasushi Suzuki and Mohammad Dulal Miah 2. A Typology of Financial Business Models on Digital Transformation: Expected Impacts on Commercial Banks, Yasushi Suzuki and Mohammad Dulal Miah 3. Fintech, Technomania and Persistent Socio-Civilizational Challenges, Mohammad Omar Farooq and Mohammad Dulal Miah Part II Empirical Studies 4. Business Risk Mitigation through "Value-Chain Integrated" Financing in Islamic Peer to Peer Lending in Indonesia: PT Qazwa Mitra Hasanah’s Experience, Sigit Pramono, Dikry Paren, M. Iqbal Ramadhan, and Muhammad Razikun 5. Prospects and Opportunities of Islamic Crowdfunding in Bangladesh, S. M. Sohrab Uddin, Rima Akter, Md Imran Hossain　Anik 6. Empirical Assessment on Digital Transformation in Islamic Banking, Abideen Adeyemi Adewale and Rifki Ismal 7. Fintech in Islamic Banking in Bangladesh: Opportunities and Threats, Md. Joynal Abedin, Syed Mahbubur Rahman, Riyashad Ahmed 8. Islamic digital banking in the Netherlands – Challenges and Opportunities, Muhammad Ashfaq, Mai Tran, Rashedul Hasan, Muhammad Abdul Rauf 9. Can Islamic FinTech Best Serve the Migrants’ Interest in Remittance Services? The South and South-East Asian Perspective, S. M. Sohrab Uddin, Tasfika Khanam 10. The impact of central bank digital currency (CBDC) on the operations of Islamic Banks, Kamrul Hasan 11. Takafultech Reflects the Maqasid al-Shariah Ethos in Takaful, Amirul Afif Muhamat and Norfaridah Ali Azizan 12. Digital Transformation and Accounting Issues in Takaful: The Case of Indonesia, Ersa Tri Wahyuni 13. Dilemma and Challenges for fintech application in Waqf Administration / Regulation in contemporary Muslim majority countries: A Case of Bangladesh, Kamrul Hasan 14. Breaking the barriers of Zakat Management System through Islamic Fintech: The Case of Bangladesh, S. M. Sohrab Uddin, Afroza Sultana 15. An inquiry into the application of Artificial Intelligence on Fatwa, Ali Polat, Shoaib Khan and Usman Bashir Conclusion, Yasushi Suzuki and Mohammad Dulal Miah