INCEIF signs MoU with IFR on Islamic social finance

The International Centre for Education in Islamic Finance (INCEIF) has signed a memorandum of understanding (MoU) with the International Federation of Red Cross and Red Crescent Societies (IFRC) to leverage Islamic social finance opportunities and develop strategies and fundraising tools in support of Red Cross and Red Crescent humanitarian aid programmes.

The MoU was signed at INCEIF’s Kuala Lumpur campus by INCEIF President and CEO Daud Vicary Abdullah, and IFRC’s Under Secretary General for Partnerships, Tan Sri Dr Jemilah Mahmood.

The partnership aims to explore and expand ways through which Islamic social finance can be used as a tool to raise operational finances for national Red Cross and Red Crescent societies to respond to disasters and other crises, reduce vulnerabilities, support healthy and safe living and foster a culture of peace in at-risk communities.

As part of the agreement, INCEIF will undertake research in innovative financial instruments that could assist Red Cross and Red Crescent humanitarian and development initiatives, including the design and development of sukuk social impact bonds, waqf and zakat endowment funds and other mechanisms that make use of obligatory and voluntary faith-based donations. Pilot projects will launch soon in selected countries in Africa, the Middle East and Asia, including Malaysia.

INCEIF will also provide guidance on ways to tap Islamic social finance, connect its alumni network in 80 countries with national Red Cross and Red Crescent societies and advocate for the direct funding of programmes that alleviate suffering, build resilience and promote human dignity. In addition, the MoU includes the development of an IFRC internship programme for INCEIF students.

Dr Jemilah says Islamic social financing has the potential to help address significant financial challenges in meeting the needs of millions of people caught in crises and poverty.

“We are keen to explore innovative ways the Islamic finance sector can work with Red Cross and Red Crescent societies and demonstrate solidarity and principled action to save lives and promote dignity,” Dr Jemilah stated. “We will be eager to see Islamic social finance contribute to strengthening communities and realising the IFRC`s commitment of leaving no one behind.”

“At INCEIF, we realise that it is a winning strategy to promote the development of Islamic finance by establishing effective collaborative partnerships around the globe,” said Daud. “INCEIF is proud to add IFRC to our list of partners, which includes the World Bank, the Islamic Development Bank and the Islamic Financial Services Board. It is an honour for INCEIF to share our expertise and knowledge in Islamic finance to better society through the duty of care, which is the true spirit of Islam.”

Strides made in Islamic economy as a result of the 12th WIEF

The 12th World Islamic Economic Forum (WIEF), which was held in Jakarta from 2 to 4 August 2016 facilitated developments that bolstered regional cooperation and business ties.

At the event, the country leaders highlighted that growing inequality continues to defy solutions for inclusive development and that centralised development tends to overlook or even marginalise large sections of society in many countries. They also pointed out that the unintended consequence of innovative technology often was the enrichment of a few; that the potential of the young population of the developing world has not been effectively utilised; and that enhancing media strategy to improve global perception of Islamic world investments and business potentials is important.

Sri Mulyani Indrawati, Minister of Finance of Indonesia affirmed that WIEF recognises these challenges through its theme of Decentralising Growth, Empowering Future Business, and a complementary forum programme. The forum, while focused on the development of micro, small and medium enterprises (MSMEs), also discussed topics relating to the expansion of the global halal ecosystem, enhancing the inclusiveness of Islamic finance, the support of startups and the development of the creative industry.

In addressing the issues of decentralisation to enable inclusive economic growth, the 12th WIEF recommended:

• Promoting and supporting an enabling environment including access to finance, for the development and corporatisation of MSMEs and cooperatives to address job creation, income generation and to unlock economic opportunities in rural communities; 
• Harnessing the use of innovative training to provide youth with modern skills to enhance their economic exchange value as well as to infuse corporate social responsibility for promoting wider social benefit from the application of innovative technology; 
• Expanding the use of Islamic finance to grow the halal ecosystem, modest fashion industry, infrastructure development and social finance; 
• Harnessing the use of disruptive technologies for the wider benefit of a more inclusive society; and 
• Developing strategies to enhance the potential of creative industries to spread economic growth.

The positive outcome of the 12th WIEF will be further strengthened by the implementation of 10 projects for which memoranda of understanding (MoUs) were signed and exchanged in keeping with what Malaysia PM Dato’ Sri Najib Razak said at the 12th WIEF, “We look forward to opportunities to collaborate with other jurisdictions, as well as with industry and academia, to expand international connectivity, strengthen talent and capabilities, and grow the global Islamic capital market for the benefit of all.”

Totalling US$899.6 million, the 10 agreements involved 13 Malaysian, eight Indonesian and two Japanese corporations and are expected to have a significant impact on the economy of ASEAN and neighbouring regions:

Malaysian property developers Sime Darby, SP Setia Indonesia and I&P Group signed an agreement worth US$862 million with Indonesia’s PT Hanson International to jointly develop affordable housing in the Maja area in West Jakarta, Indonesia.

Another significant collaboration was the tripartite agreement amounting to US$12 million made between Kumpulan Perubatan Johor and two Japanese companies, Sojitz Corporation and Capital Media Company for the setting up of an Oncology Centre at Rumah Sakit Medika Bumi Serpong Damai in Tangerang, Indonesia.

Malaysia’s Majlis Agama Islam Negeri Johor (MAINJ) signed an agreement with UMLand J-Biotech Park to spearhead the development of Johor Halal Park, envisioned to become the first premium bio-halal industrial park in Malaysia with world-class facilities and a halal ecosystem.

In the field of education, Brainy Bunch inked an agreement with PT Brainy Bunch Indonesia giving the Indonesian company the rights to set up Brainy Brunch Islamic Montessori preschools in Indonesia.

Bursa Malaysia and Indonesia Stock Exchange signed a pact to develop Islamic capital markets in both countries with the goal of establishing Malaysia and Indonesia as a leading Islamic capital market hub in the world.

In closing, the Chairman of the WIEF Foundation, Tun Musa Hitam stated that the agreements between national and regional corporations proved that the WIEF has been a strategic platform for important business and economic collaborations to strengthen and connect the Muslim nations with their regional and global counterparts.

“This reflects our confidence, courage and decisiveness in responding to our current economic challenges, in which collaborative model that enables joint value creation is important and necessary in order to create a levelled playing field between the Muslim and non-Muslim world,” he said.

Interested?

Download the 2016 Forum Report for WIEF (PDF)

Malaysia, Indonesia deepen financial integration

Bank Negara Malaysia has signed a bilateral agreement with Indonesia's Otoritas Jasa Keuangan under the ASEAN Banking Integration Framework (ABIF). The agreement was signed by Muhammad bin Ibrahim, Governor, Bank Negara Malaysia and Dr Muliaman Hadad, Chairman of Board of Commissioners, Otoritas Jasa Keuangan, in conjunction with the 11th Meeting of the Annual Consultation between the President of the Republic of Indonesia and the Prime Minister of Malaysia.
The agreement, which seeks to operationalise the earlier Heads of Agreement in 2014, will provide greater access and operational flexibility for Malaysian and Indonesian qualified ASEAN Banks operating in the respective jurisdictions. The commitments in the agreement form part of the ASEAN Framework Agreement on Services.

Following the official launch of ABIF and establishment of the ASEAN Economic Community in 2015, the agreement represents a significant milestone towards achieving greater banking and financial integration within ASEAN.

With the implementation of the agreement, Bank Negara Malaysia looks forward to the establishment of Indonesian qualified ASEAN Banks in Malaysia. Under the agreement, it is envisaged that both Malaysian and Indonesian banks will have a greater role in facilitating cross-border trade and investment between both countries. The increased banking and financial integration will further deepen the potential for mutually reinforcing growth and greater shared prosperity between both countries and within the region.

To promote adequate safeguards in a more integrated environment, Bank Negara Malaysia and Otoritas Jasa Keuangan have also signed a memorandum of understanding (MoU) in April 2016 to further enhance supervisory cooperation. The MoU covers areas of supervisory cooperation and coordination, including exchange of information, facilitation of consolidated and cross-border on-site supervision, financial crime and crisis management in accordance with the principles set out in the Core Principles of Effective Banking Supervision and the Insurance Core Principles.

ICD and OJSC Agroinvestbank sign MoU for SME financing

Source: ICD. ICD signs MoU with OJSC Agroinvestbank for financing facility.

The Islamic Corporation for the Development of the Private Sector (ICD) and OJSC Agroinvestbank of the Republic of Tajikistan have signed a memorandum of understanding for cooperation to consider the extension of a financing facility to the bank as part of the allocation of US$25 million for Tajikistan.

The line of financing will be extended by OJSC Agroinvestbank to the SME sector for industrial, communication, technology, health, construction and agricultural projects. 

Khaled Al Aboodi, the CEO and General Manager of ICD, commented: “The small and medium sized enterprises (SMEs) have a crucial role to play in a country’s growth and development, and ICD has big plans for them. This is an important sector in all the member countries, including the higher income ones. ICD is now focusing on this sector by extending lines of finance to local banks in addition to the establishment of ASR Leasing Company in Tajikistan - a company specialised to provide shari'ah compliant leasing products to the SME sector.”

ICD previously extended a total of US$11.5 million in financing for the development of SMEs in Tajikistan which demonstrates ICD’s commitment to develop the private sector in its member countries.

The Chairman of OJSC Agroinvestbank said, "The close and mutual fruitful cooperation between Agroinvestbank and ICD positively affects the development of the economy of the Republic of Tajikistan through financing SMEs in key sectors such as agricultural, industry, construction and etc. The Islamic banking products have a huge potential to meet the increasing demand for long term financing of SME in Tajikistan. In this regard, the signing of present MoU is a step towards strengthening and deepening our further collaboration in context of development of the economy of the Republic of Tajikistan and enabling SMEs access to finance.”

ISESCO, International Turkic Academy sign MoU

Source: ISESCO.

A Memorandum of Understanding was co-signed between the Islamic Educational, Scientific and Cultural Organization (ISESCO) and the International Turkic Academy in Baku, Azerbaijan, alongside the plenary session of ISESCO 12th General Conference.


The MoU was co-signed for ISESCO by its Director General, Dr Abdulaziz Othman Altwaijri, and for the International Turkic University by its President, Dr Darkhan Kydyrali. It provides for cooperation to drive progress in the areas of education, science, culture and communication, promote mutual understanding between peoples, contribute to peace and security, stimulate research in areas of common interest, and ramp up support for national and regional efforts toward sustainable development goals.

Arab Monetary Fund and International Islamic Liquidit Management Corp to promote financial inclusion in the Arab world

The Arab Monetary Fund and International Islamic Liquidity Management Corporation (IILM) have agreed to cooperate with an MoU that will allow the two parties to launch joint activities and programmes that help support economic development, opportunities, as well as to promote financial inclusion in the Arab region.

The two institutions will work together to provide technical support services and to build capabilities to develop the Islamic finance industry. The Arab Monetary Fund will contribute its expertise on the region, while the IILM will facilitate liquidity management for institutions that offer Islamic financial services.

Professor Datuk Rifaat Ahmed Abdel Karim, Chief Executive Officer of the IILM said, “This collaboration is in line with the objectives of the IILM to facilitate liquidity management for Islamic financial services in the Arab region thereby enhancing their resilience and ability to meet future economic challenges. The development of a systemic shari’ah-compliant liquidity management infrastructure, accepted across multi - jurisdictions in which Islamic financial services operate, is instrumental towards ensuring sustainable financial stability.”

HE Dr Abdulrahman Al Hamidy, Director General Chairman of the Board, Arab Monetary Fund, said that that the signing of this memorandum is within the framework of the Fund's interest to develop its activities and programmes in the field of Islamic finance and financial inclusion. Furthermore the MoU attempts to consolidate relations with institutions and related bodies especially with the IILM and its role in supporting the opportunities of the development of Islamic industry.

The Arab Monetary Fund works to strengthen the foundations of monetary integration of the Arab economies, and provides financial and technical support for economic and financial reforms undertaken by the Arab countries to support the development and improvement of growth opportunities. On the other hand, the IILM aims to assist in the development of the Islamic finance industry by facilitating liquidity management for institutions that offer Islamic financial services.

11street and KWC Fashion Mall ink e-commerce deal

Source: 11street.

11street, one of the largest online marketplaces in Malaysia, and KWC Fashion Mall, one of Kuala Lumpur's 'Must Visit Tourist Destinations', have signed a Memorandum of Understanding (MoU) to allow shoppers on 11street's marketplace portal to enjoy wholesale shopping online.

Some 2,000 products from KWC Fashion Mall will progressively go on sale on 11street in a move to create an omni-channel presence for KWC.

“Being a culture-rich country, Malaysia is known for its vibrant choices of fashion apparel. The partnership between 11street and KWC significantly reinforces our ongoing commitment to enable our consumers to find what they love at 11street with the expanded range of trendy offerings – what’s better than having the best variety of items at wholesale prices!” said Hoseok Kim, Chief Executive Officer of 11street.

Fiona Bong, Centre Manager of KWC added that the collaboration will benefit KWC tenants at the physical mall by providing them with exposure to raise awareness whilst offering a positive boost in sales.

"11street is a gateway to new target audiences for the various merchants that we have under our roof. In today's fast-paced, cost-conscious and competitive environment, it is no longer enough to rely on just one single go-to-market channel. As such, integrating e-commerce into the mix will definitely help our merchants to grow and achieve better sales, and the same time, it also help bringing awareness to their shops in the physical mall," she said.

Source: 11street.

In conjunction with the Raya festive season, 11street is running promotions such as discounts of up to 70% as well as free shipping on selected items.

“Our broadly collaborative-curated content via a mobile app enables consumers to access hot items and products quicker, especially on the ‘Shocking Deals’ Section where we provide the lowest price guarantee giving consumers better value for their purchases. Coupled with our Hari Raya promotions, consumers can navigate and shop for what they love at 11street effortlessly for themselves, friends and family during this festive season,” Kim said.

Interested?

Get directly to the KWC Fashion House products on 11street

IFSB, INCEIF renew cooperation agreement

The Islamic Financial Services Board (IFSB) and INCEIF – The Global University of Islamic Finance have renewed an agreement to facilitate international cooperation between the two organisations to provide relevant activities relating to capacity building and awareness promotion in Islamic finance. The Memorandum of Understanding (MoU) was signed on the sidelines of the 12th IFSB Summit in Almaty, Kazakhstan on 19 May.

This mutual co-operation aims to strengthen the efforts of the two institutions in promoting an exchange of information, undertaking research, development, training and education in the Islamic financial services industry. More specifically, the MoU identifies the following areas of cooperation between the IFSB and INCEIF: 

• Jointly exploring and undertaking various research issues concerning Islamic financial services industry. 
• Providing reciprocal staff development and exchange programmes. 
• Building awareness among the industry players through jointly conducting learning and awareness programmes including among others: conferences, seminars, workshops, roundtables, trainings (including custom-designed learning and training programmes). 
• Cooperating in providing technical assistance to facilitate the implementation of the IFSB standards and to assist in building the necessary financial infrastructure for development of a sound and stable Islamic financial services industry. 

Under the first MoU, signed in 2012, the IFSB and INCEIF successfully held a series of six Executive Forums (EF) covering topics in Islamic finance. The IFSB-INCEIF Executive Forums on Islamic Finance aim to provide a platform for industry’s global leaders to discuss emerging issues facing the global Islamic financial services industry with an emphasis on issues related to supervision and prudential regulation at the national and international levels.

The next Executive Forum on Islamic Finance, themed Building Momentum for Islamic Liquidity Management, will be held 3 to 4 June 2015 in Kuala Lumpur, Malaysia.

BIBF inks MoU with Shari’ah Research Academy for Islamic Finance

Source: BIBF. From left: BIBF’s Head of Centre for Academics and Islamic Finance Ahmed Al Rayes, and ISRA Executive Director Professor Mohamad Akram Ladin. 

BIBF, an institution focused on training and development of human capital in Bahrain, will cooperate with the International Shari’ah Research Academy for Islamic Finance (ISRA) in the field of academics and training under an MoU signed by BIBF’s Head of Centre for Academics and Islamic Finance Ahmed Al Rayes, and ISRA Executive Director Professor Mohamad Akram Ladin earlier this month. 

The agreement includes collaborative academic and training activities in the banking and finance field, achieved through the exchange of faculty and researchers, combined training programmes, seminars, conferences and workshops.

Said Professor Ladin: “The financial sector is key to the sustenance of the national and global economy, and enhancing the qualification levels of the labour market supports economic growth. The collaboration between our two entities aims to serve this purpose,” he said.

Al Rayes emphasised BIBF’s vision to promote Islamic finance training globally and collaborate with international centres of excellence. “The MoU with ISRA is fundamental towards the achievement of BIBF’s objectives in the fields of conventional and Islamic finance, especially as both entities share a common goal to promote innovation and dynamism in our mutual countries,” he said.

He also noted that the organisation’s strategy underpins Bahrain’s position as a regional financial hub, and continuous training of this sector has reinforced the industry’s aspirations for growth.

Al-Imam Muhammad bin Saud Islamic University signs MoUs in Indonesia

Source: Al-Imam Muhammad bin Saud Islamic University.

The Undersecretary of Al-Imam Muhammad bin Saud Islamic University for Cognitive Exchange and International Communication, Dr Mohammad bin Said Al-Alam, has signed a memorandum of understanding (MOU) with the Undersecretary of the University of Muhammadiyah Malang in Indonesia, Dr Bambang Widagdo, in the presence of the Saudi Ambassador to the Republic of Indonesia Mustafa bin Ibrahim Al-Mubarak.

Al-Imam University said the signed MoU is based on mutual agreements between both Kingdom of Saudi Arabia and the Republic of Indonesia in academical cooperation and  the teaching of the Arabic language.  

A second MoU was signed between Dr Al-Alam, representing Al-Imam Muhammad Ibn Saud Islamic University for Knowledge Exchange and International Communication, with Professor Dr H Farid Wajdi Ibrahim, representing the Universitas Islam Negeri (UIN) Ar-Raniry Banda Aceh, Indonesia as Rector.

Dr Al-Alam separately signed a MoU with Dr Boroososelo, Director-General of the Sharia Courts Authority of the Supreme Court of the Republic of Indonesia. The signed MoU aims to the exchange of judicial consultations and experiences in qualifying judges between both parties.       

Meethaq, Al Salam Bank Bahrain and BMI Bank sign MoU on Islamic banking

Meethaq Islamic Banking, the Islamic banking pioneer from Bank Muscat in Oman, has come together with Al Salam Bank Bahrain (ASBB) and Bahraini retail and commercial banking institution BMI Bank on a Memorandum of Understanding (MoU) to collectively pool expertise, technologies and resources and work together across a range of Islamic banking activities. 

Source: Meethaq. From left, Jamal Al Hazeem, Chief Executive Officer of BMI Bank; Sulaiman Al Harthy, Group General Manager – Meethaq Islamic Banking; and Yousif Taqi, Chief Executive Officer of Al Salam Bank Bahrain. 

The MoU was signed at BMI Bank's headquarters by Sulaiman Al Harthy, Group General Manager – Meethaq Islamic Banking, Yousif Taqi, Chief Executive Officer of Al Salam Bank, and Jamal Al Hazeem, Chief Executive Officer of BMI Bank.

Al Harthy said: "Meethaq is delighted to sign the MoU with Al Salam Bank and BMI Bank and we will work together to offer various Islamic finance products covering treasury, trade finance and capital market in Oman. Meethaq is working to strengthen its operations in the Sultanate which is witnessing substantial growth in Islamic banking industry and we consider our partnership with Al Salam Bank and BMI Bank a great advantage to maximise favourable opportunities and thereby expand our coverage."

Al Hazeem said: "Since its inception in 2013, Meethaq has emerged as a leading Islamic banking service provider in Oman and has enhanced its reputation within the region through its investments in staff, systems and controls along with the timely launch of several world-class shari'ah based products and services. Our organisations share mutual principles, values and expertise and are therefore pleased to sign this MoU and look forward to enhancing this partnership in the coming years."

Among the Islamic banking activities to be considered under the MoU are Islamic syndications, particularly those issued in Oman, treasury transactions, liquidity management products and Islamic trade finance transactions.