Islamic fintech industry sets strategic priorities to drive financial inclusion

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KUALA LUMPUR (July 23): The stakeholders and ecosystem players of the Islamic financial technology (fintech) space have determined nine strategic priority areas that will further reinforce and enhance financial inclusion in Malaysia.

Islamic Finance News publisher REDmoney Group and the Malaysia Digital Economy Corporation (MDEC) said in a joint statement that of these strategic priority areas, the most critical were the setting-up of a national Islamic fintech taskforce; the renewed focus of enhancing digital and Islamic financial literacy, especially within B40 segment; developing smart partnerships among ecosystem players; and ensuring there was greater readiness among Islamic institutions to embrace digitalisation.

“Instrumental to the success of these initiatives are the collaborations between industry participants - start-ups, financial institutions, religious bodies, as well as the government and regulators,” they said.

The nine strategic priority areas were drafted based on input from decision-makers and leaders from the industry during the Islamic Fintech Dialogue 2020: Driving Financial Inclusion through Islamic Fintech held virtually in May. The dialogue session was organised by REDmoney and MDEC.

“The key findings from the dialogue session are in line with the government’s Shared Prosperity Vision 2030, an initiative that aims to leverage on the country’s Islamic finance global leadership and digital economy aspiration to create sustainable growth while ensuring fair and equitable market access for all Malaysians,” the statement said.

Meanwhile, MDEC chief executive officer Surina Shukri said with COVID-19 pandemic still ongoing, businesses, the public sector and the general populace were now aware and understood how important it was to take the digital leap.

“While much larger businesses and corporates can navigate and pivot quickly to digitalise, most small businesses are still struggling to survive.

“In fact, financial inclusion is now one of the primary factors that will sustain and drive forward the economy,” she said.

Surina added that while it provided digital cost savings among the financially excluded and underserved populations, digital financial services could also introduce a wide range of solutions that were suited to their needs.

More critical is how these fintech solutions will be delivered in a responsible and more cost-effective manner to ensure they are truly affordable to customers and remain sustainable for providers.

“The end-goal is to ensure the B40 group and the micro, small and medium enterprises will be empowered via Islamic fintech and financial inclusion,” said Surina.