The Role of Islamic Financial Institutions in Growing the Halal Market.

At ICHS we had the privilege of participating in the highly prestigious and influential panel of  Al Baraka Summit in London in November 2022.

For those who may not be aware, Albaraka Forum for Islamic Economy is a leading foundation that aims to be the foremost authority and reference on everything pertaining to the Islamic Economy and Finance globally as well as work on developing cognitive content for Islamic Economy commensurate with its heritage, diversity, and inclusivity.

At the fifth session of Al Baraka Summit. ICHS CEO; Eng. Ashraf Tanbouly sat on a panel with many brilliant minds in Islamic Finance and investment, to talk about “The Effectiveness of Islamic Financial Institutions in the British Market

The esteemed speakers in the panel included Mr. Adnan Halawi, MA, CPM. Senior Proposition Manager, LSEG (London Stock Exchange Group).Mr. Stuart Hutton Chief Investment Officer, Simply Ethical. Prof. Dr.Hussein Abdou Faculty Director of Research & Enterprise, Professor of Banking & Finance, Faculty of Business & Justice; University of Central Lancashire. Mr. David Testa DDCAP Group™️, Executive Board Director for Business Origination. And Chairperson: Dr. Natalie Schoon. Principal Consultant, Formabb Ltd

In this panel, the focus was on how the halal market is expanding & according to the Al Baraka Forum’s annual report the Halal market is encompassing +100 million customers in more than 75 countries.

However, when you compare this figure to other finance institutions’ assets. Islamic finance system is still fairly nascent in the UK.

The experts agreed that, the “Halal” finance market, has strong potential but still faces many challenges that need to be addressed in the UK including:

• The size of the Muslim population is relatively small.
• Islamic finance is marketed to Muslims even though non muslims might also agree with their ethos.
• The Pricing is too high.
• Lack of standardization
• Lack of capital market instruments.

On the other hand the esteemed experts agreed there are great opportunists to be seized if we consider the following steps in the future to enhance growth:

• Refocus marketing efforts to become more inclusive
• Focus on the local economy, and invest in SME’s as well as minority owned enterprises
• The connection between halal and sustainably

Our CEO, Eng. Ashraf Tanbouly spoke about the increasing demand for halal products all over the world, Which is leading to producers of all kinds in need of funding to transform their production process to become Halal certified as an example of a great market opportunity. Currently these firms seek funding from traditional banks to get loans or IPOs “initial public offering” & don’t go for Islamic banking institutions and ask for Islamic investments like “ Morabeha” or “ Sukuk” or “ Musharakah” even though they may be a better alternative because of their lack of knowledge pertaining to a lot of Islamic finance products and how they can utilize them to build and grow out their burgeoning halal business. 

He also emphasized the need for Islamic financial institutes to have a solution ready to account for said growth in demand to offer customers, and expressed the importance of participation in Al Barka forum every year as he also stated:

“We look forward to taking part in future editions of Al Baraka Forum”.

For those who were not able to take part and are interested to view some of the panels feel free to log onto their youtube channel here”