- Islamic Finance, Islamic Law, Sukuk & Capital Markets, Islamic Economics, Islamic Economics and Finance, Islamic Banking, and 16 moreMathematical Finance, Islamic Studies, Islamic History, Sufism, Islamic Philosophy, Renewable Energy, Smart Grid, Game Theory, Behavioral Economics, Experimental Economics, Halal Supply Chain, Halal Economy, "Belt and Road" Initiative, Ethics, Technology, and Moral Philosophyedit
- Experienced entrepreneur and business strategist with substantial innovation, market advisory, operational management... moreExperienced entrepreneur and business strategist with substantial innovation, market advisory, operational management and start-up experience. He consults for multi-lateral organizations (like USAID-IGNITE, ASEAN, UNCDF), MNCs and MSMEs on various consulting projects. His research interests include green growth, economic sustainability, and behavioral investigations into human decision-making using game theory. As a founder, he works on business growth strategies and drives breakthroughs in new sectors.edit
Returns are no longer the only factor to consider when investing. Investors increasingly want companies that are as committed to making the world a better place as they are to making money. The concept of values-based investing is not... more
Returns are no longer the only factor to consider when investing. Investors increasingly want companies that are as committed to making the world a better place as they are to making money. The concept of values-based investing is not new, but it has grown significantly in the past few years.
Many funds and strategies exist today to facilitate this movement as more investors want to use their money positively to impact society. In this context, we find terms such as socially responsible investing (SRI), environmental, social, and governance investing (ESG investing), Shariah-compliant investments and impact investing.
Many funds and strategies exist today to facilitate this movement as more investors want to use their money positively to impact society. In this context, we find terms such as socially responsible investing (SRI), environmental, social, and governance investing (ESG investing), Shariah-compliant investments and impact investing.
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It is important to treat climate risks as new business risks. Climate change's impacts are becoming more evident and widespread, posing significant challenges to businesses in a wide variety of industries. Managing climate risks as part... more
It is important to treat climate risks as new business risks. Climate change's impacts are becoming more evident and widespread, posing significant challenges to businesses in a wide variety of industries. Managing climate risks as part of business risk management is essential for long-term sustainability and success. And too few business leaders are paying the right amount of attention to the associated risks that a changing climate poses to their companies outside of the most carbon-intensive industries.
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Over the past few years, the metaverse—a virtual universe where people and businesses can interact—has grown in significance. Although the metaverses are still in their infancy, there has been an increase in interest and funding for these... more
Over the past few years, the metaverse—a virtual universe where people and businesses can interact—has grown in significance. Although the metaverses are still in their infancy, there has been an increase in interest and funding for these worlds. Given the absence of Islamic financing frameworks for the metaverses, this poses a significant challenge for Islamic financial participants and investors to understand how the Shariah would treat them.
We approach the discussion of this important matter by first breaking down the components of the immersive digital environments known as the metaverse. Subsequently, we analyze its sub-components according to its design, use and function against the rulings prescribed by the Shariah so as to ascertain compliance on how it is actually being used. Many aspects of the metaverse were initially started to reap virtue and benefit to the wider public which the traditional system could not provide but such virtuous intentions need to be governed by a set of principles and framework to ensure that harmful consequences do not result from unintended outcomes and effects.
We approach the discussion of this important matter by first breaking down the components of the immersive digital environments known as the metaverse. Subsequently, we analyze its sub-components according to its design, use and function against the rulings prescribed by the Shariah so as to ascertain compliance on how it is actually being used. Many aspects of the metaverse were initially started to reap virtue and benefit to the wider public which the traditional system could not provide but such virtuous intentions need to be governed by a set of principles and framework to ensure that harmful consequences do not result from unintended outcomes and effects.
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Charity fatigue is a real issue. Also, a great deal of money is donated to fund charitable causes, but it is hard to observe how efficient or effective these efforts are, or whether they reach the intended beneficiaries, in some cases.... more
Charity fatigue is a real issue. Also, a great deal of money is donated to fund charitable causes, but it is hard to observe how efficient or effective these efforts are, or whether they reach the intended beneficiaries, in some cases. The performance of such organisations is hardly monitored and barely assessed. Such issues can be overcome by a cash waqf (endowment) concept and then utilising the blockchain to fortify the accountability in collections, administration, and distribution.
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According to the Quran and Sunnah, the various dimensions in the sustainable framework suggest practices that will operationalise man’s duty towards sustainability at the macro and micro levels. It is an observable (and measurable) set of... more
According to the Quran and Sunnah, the various dimensions in the sustainable framework suggest practices that will operationalise man’s duty towards sustainability at the macro and micro levels. It is an observable (and measurable) set of recommendations that will prevent or at least curtail unsustainable behaviours, practices and outcomes. Technologies like the blockchain and AI can operationalise the transparency and accountability required by Islamic institutions.
The adoption or acceptance of any digital currency has to lie on its usability, convenience and flexibility. This acceptance must involve not only the end-users but also the retailers and all commercial centres, including financial... more
The adoption or acceptance of any digital currency has to lie on its usability, convenience and flexibility. This acceptance must involve not only the end-users but also the retailers and all commercial centres, including financial institutions and payment gateways. The wider practical adoption or acceptance of digital currencies, besides CBDCs, at the commercial level will likely take place when there is a better understanding of how the price discovery of different cryptocurrencies translate to better predictability and acceptance, despite its attendant volatilities. Such in-depth understanding will be crucial to develop hedging and diversification strategies for financial management in the investment portfolios or treasury operations of the future.
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Despite the significant benefits of digital transformation, there are forces such as cyber-attackers and hackers that will overturn these benefits through forcing system breakdowns, cloud data leakages, etc. Cybersecurity is one of the... more
Despite the significant benefits of digital transformation, there are forces such as cyber-attackers and hackers that will overturn these benefits through forcing system breakdowns, cloud data leakages, etc. Cybersecurity is one of the top priorities for all institutions, including Islamic financial institutions, due to the rapid evolution of complex technologies, cross-border data exchanges, emerging usage of cloud-based systems and the internet of things.
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For most people, the pandemic lockdown measures have come quickly and as they adjust to working from home and social distancing, there are those who resist or are slow to adapt to the new normal. Hence, as in all new regulations,... more
For most people, the pandemic lockdown measures have come quickly and as they adjust to working from home and social distancing, there are those who resist or are slow to adapt to the new normal.
Hence, as in all new regulations, enforcement plays a critical role to regulate new behaviors in every citizen. Like all rules and laws, containment measures to “keep the curve flat” to prevent a second wave will be ineffective if none of them are complied to, so enforcement has to come into play for the greater good.
Hence, as in all new regulations, enforcement plays a critical role to regulate new behaviors in every citizen. Like all rules and laws, containment measures to “keep the curve flat” to prevent a second wave will be ineffective if none of them are complied to, so enforcement has to come into play for the greater good.
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“ONE Belt One Road” is China’s roadmap for constructing infrastructure for better trade ties and a bold strategy to provide jobs for its people. The initiative spans 68 countries and encompasses an estimated 38 percent of the world’s GDP.... more
“ONE Belt One Road” is China’s roadmap for constructing infrastructure for better trade ties and a bold strategy to provide jobs for its people. The initiative spans 68 countries and encompasses an estimated 38 percent of the world’s GDP. It consists of a land route from Beijing to the Netherlands, creating a direct land connection through majority Muslim markets in Central Asia (Kazakhstan, Kyrgyzstan, Turkmenistan, Iran), Europe (Turkey) and a sea route from Guangzhou to both Antwerp and Australia, including the pre-dominant Muslim areas of Africa (Somalia, Kenya, Djibouti, Eritrea), Indian Ocean (Maldives) and ASEAN (Brunei, Malaysia, Indonesia, parts of the Philippines) region.
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The survival of financial institutions is connected with the adoption of innovation, and in embracing digital transformation to radically improve efficiency and performance within the organization. Digital transformation and new... more
The survival of financial institutions is connected with the adoption of innovation, and in embracing digital transformation to radically improve efficiency and performance within the organization. Digital transformation and new technology adoption have changed the way of doing businesses and channels to offer banking and financial products and services more intuitively and in a more trustworthy fashion. These new ways may be very different from the past and has resulted in reshaping the existing models of businesses and creation of new innovative ones. In doing so, the transformations have created new industry and market leaders.
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Building the Islamic fintech ecosystem is complicated and it involves various market participants and stakeholders coming together and working toward shared goals of a unified Islamic economic community, increased financial inclusion for... more
Building the Islamic fintech ecosystem is complicated and it involves various market participants and stakeholders coming together and working toward shared goals of a unified Islamic economic community, increased financial inclusion for the unbanked and the seamless cross-border flow of goods, services and payments.
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Reliance on physical documents leads to delays, inefficiencies and increases exposure to errors and fraud. Financial intermediaries, while providing interoperability for the finance system and reducing risk, create unnecessary overhead... more
Reliance on physical documents leads to delays, inefficiencies and increases exposure to errors and fraud. Financial intermediaries, while providing interoperability for the finance system and reducing risk, create unnecessary overhead costs and increase compliance requirements. Smart contracts, on the blockchain or otherwise known as distributed ledgers, have the capacity to inject greater efficiency and productivity while saving costs associated with traditional contracts. Many financial enterprises are exploring the use of smart contract technology for various applications across the banking, financial services and insurance sectors. As of now, prototypes developed have been simplified versions of a smart contract but more work needs to be done in key areas which will tackle legal and regulatory compliance, scalability and security, and the ability to code complex contracts which currently dominate the financial services landscape. In this article, we attempt to give a brief overview of what a smart contract entails, understand the benefits of smart contracts over traditional ones, their current limitations and explore use cases.
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There is a need for Islamic Finance to develop new strategies to cope with the next economy, which will be driven by those who embrace innovation that will build the future. The blockchain will play a crucial role in boosting the... more
There is a need for Islamic Finance to develop new strategies to cope with the next economy, which will be driven by those who embrace innovation that will build the future.
The blockchain will play a crucial role in boosting the financial sector (banking, insurance, investment, etc.) including the Islamic Finance sector. Addressing the digital revolution that is happening right now will foster competitive advantage for the Islamic Finance industry.
The blockchain will play a crucial role in boosting the financial sector (banking, insurance, investment, etc.) including the Islamic Finance sector. Addressing the digital revolution that is happening right now will foster competitive advantage for the Islamic Finance industry.
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There has been substantial growth in sustainable investing in recent years, as the climate crisis, climate risk and investment opportunities from the transition to a sustainable, low-carbon world have come into focus for all types of... more
There has been substantial growth in sustainable investing in recent years, as the climate crisis, climate risk and investment opportunities from the transition to a sustainable, low-carbon world have come into focus for all types of investors. Rapid growth increases the risk of greenwashing, however, and creates other challenges for investors, investment managers and regulators. We ruminate over sustainable investment strategies and the various types of screening in green investments.
Investment must flow to key sectors like renewable energy and sustainable infrastructure to ensure a successful global transition to Net Zero and enhance climate-resilient development. As these firms and sectors transition to more sustainable business models, they must be supported through greener funding alternatives that are aligned to decarbonization. To help do this, we suggest a sustainability assessment metric to ensure real decarbonization of portfolios. We utilize a full portfolio approach with indicators to be measured in order to assess sustainability in portfolio investment.
Investment must flow to key sectors like renewable energy and sustainable infrastructure to ensure a successful global transition to Net Zero and enhance climate-resilient development. As these firms and sectors transition to more sustainable business models, they must be supported through greener funding alternatives that are aligned to decarbonization. To help do this, we suggest a sustainability assessment metric to ensure real decarbonization of portfolios. We utilize a full portfolio approach with indicators to be measured in order to assess sustainability in portfolio investment.
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The development banks (DBs) contribute to a broader aspect of the financial system, rather than private banks that serve more specific areas in retail, wholesale, and investment needs. In this chapter, the author discusses how DBs work to... more
The development banks (DBs) contribute to a broader aspect of the financial system, rather than private banks that serve more specific areas in retail, wholesale, and investment needs. In this chapter, the author discusses how DBs work to support the implementation of the United Nations Sustainable Development Goals (SDGs) by providing financing for sustainable infrastructure, renewable energy, climate change adaptation and mitigation, and biodiversity conservation. They also help countries to build resilience to the impacts of climate change and environmental degradation. It is very critical to support sustainable economic development in various parts of the world, especially advanced and developed economies who are the major polluters. Therefore, development banks perform an important role in the contribution and
achievement of public policy objectives through green and sustainable finance. The author concludes with his thoughts on existing regulations, programs, and incentives and further recommendations to support and build a more sustainable future.
achievement of public policy objectives through green and sustainable finance. The author concludes with his thoughts on existing regulations, programs, and incentives and further recommendations to support and build a more sustainable future.
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Background - With the recent evolution of Financial Technology (FinTech), 11 peers to peer (P2P) lending platforms have been regulated by the Securities Commission in Malaysia since 2016. P2P lending platforms offer new investment... more
Background - With the recent evolution of Financial Technology (FinTech), 11 peers to peer (P2P) lending platforms have been regulated by the Securities Commission in Malaysia since 2016. P2P lending platforms offer new investment opportunities to individual investors to earn higher rates on return than what traditional lenders usually provide. However, individual investors may face higher potential risks of default from their borrowers. Therefore, individual investors need to understand the potential exposure to such P2P lending platforms to make an effective investment decision. This study aims to explore the potential risk exposures that individual investors may experience at Malaysia's licensed P2P lending platforms. Methods - Based on data collected manually from nine P2P lending platforms over five months, relationships between interest rates and various risk classifying factors such as credit rating, industry, business stage, loan purpose, and loan duration are examined...
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This conceptual paper exclusively focused on how artificial intelligence (AI) serves as a means to identify a target audience. Focusing on the marketing context, a structured discussion of how AI can identify the target customers... more
This conceptual paper exclusively focused on how artificial intelligence (AI) serves as a means to identify a target audience. Focusing on the marketing context, a structured discussion of how AI can identify the target customers precisely despite their different behaviors was presented in this paper. The applications of AI in customer targeting and the projected effectiveness throughout the different phases of customer lifecycle were also discussed. Through the historical analysis, behavioral insights of individual customers can be retrieved in a more reliable and efficient way. The review of the literature confirmed the use of technology-driven AI in revolutionizing marketing, where data can be processed at scale via supervised or unsupervised (machine) learning.
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The motivation behind this research is to direct the focus of DeFi discussion towards more productive outcomes to align to the philosophical foundations of decentralization and self-governance. We examine the tokenization of all types of... more
The motivation behind this research is to direct the focus of DeFi discussion towards more productive outcomes to align to the philosophical foundations of decentralization and self-governance. We examine the tokenization of all types of assets, and how blockchain technology can improve the way we view digital exchange and use digital money. The finance industry is progressing towards innovative solutions, capable of dealing with traditional problems and of increasing efficiency, sustainability and accountability. This progression may also address market failures within the economy.
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This paper discusses the importance of trust to economic transactions and risk-mitigation, and investigates the degree of compliance of individual behaviors to engender trust and reciprocity, through a behavioral... more
This paper discusses the importance of trust to economic transactions and risk-mitigation, and investigates the degree of compliance of individual behaviors to engender trust and reciprocity, through a behavioral approach, to understand the pervasiveness of such essential economic ethic in everyday economic transactions.The methodology of this study assesses the behavior of the subject pool (players representative of Muslims and non-Muslims)through a Trust Game that was designed to test how entrenched trust and reciprocity are in modern societies. The game is an experiment in decision-making to measure trust in economic decisions and to demonstrate that trust is as fundamental to economic transactions as self-interest. The concept of trust and reciprocity can be complex when taken into account its relationship with risk that is not readily quantified, especially in a highly uncertain situation. For this experiment, in terms of trust and reciprocity, both Muslims and non-Muslims performed well, although Muslims performed a little bit better than non-Muslims.There were no significant differences between the primed and unprimed subjects. While empirical studies have demonstrated the importance of trust and ethics in economic development, they do not demonstrate how deep religious understanding in human behavior for mutually beneficial decision-making. This paper attempts to address this concern so as to use religious values in productive economic behaviors, like mitigating risk in uncertainty through trust and reciprocity in risk-sharing. This paper provides an actual behavioral investigation into how people behave in real life as compared to what their religion prescribes to them.
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This paper proposes ways to deal with the increasing debt levels as a result of the fiscal stimulus issued to cushion the effects of an economy under lock-down, and provides alternatives for governments to deal with the current pandemic... more
This paper proposes ways to deal with the increasing debt levels as a result of the fiscal stimulus issued to cushion the effects of an economy under lock-down, and provides alternatives for governments to deal with the current pandemic crisis today. Firstly, the paper proposes to protect the vulnerable group (based on debt-to-income ratio or its debt-servicing ability) through debt forgiveness and help SMEs through debt relief via debt restructuring for their outstanding loans. To finance this, we propose to convert the increased public debt from these initiatives into equity through a GDP-linked sukuk to stabilise a sovereign's debt to GDP ratio. The repayment on these sukuk will be in proportion to the country's GDP whereby the repayment automatically declines when growth is weak and increases when GDP is strong. In doing so, an anticipated deep recession caused by the global pandemic slowdown will make it less likely to trigger a sovereign debt crisis. Secondly, such a strategy would provide the issuing government with economic reprieve when growth weakens and tax receipts decline. At the same time, investors can view these sukuk as an alternative asset class through exposure to the real economy, given the low interest rate environment. Both sides are incentivized by the debt-stabilising effects of issuance that would make sovereign defaults less likely and balance risk-taking.
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New technological innovation has incorporated frontier technologies in transforming the way we access and use existing products and services. The economy is becoming increasingly disrupted by revolutionary enterprises using technologies... more
New technological innovation has incorporated frontier technologies in transforming the way we access and use existing products and services. The economy is becoming increasingly disrupted by revolutionary enterprises using technologies such as cloud computing, extensive use of artificial intelligence and data analytics, integration of interoperable internet of things (IoT) devices and the blockchained decentralization, including advanced materials. At the same time, regulatory and legal systems need to be strengthened in order for the ecosystem be protected from cyber risks and threats to allow for the market actors to flourish. In order to enjoy the benefits brought on by digital technologies, there are regulatory issues that come with technological adoption along with financial stability implications and consumer protection, with suggestions that regulators themselves adopt advanced technologies (SupTech) to embark on the new era of market supervision and monitoring to enhance cybersecurity.
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In this conceptual paper, we provide a short discussion of AI and blockchain applications in asset management, understand the benefits and the shift in processes, as well as the challenges that need to be overcome for the practical... more
In this conceptual paper, we provide a short discussion of AI and blockchain applications in asset management, understand the benefits and the shift in processes, as well as the challenges that need to be overcome for the practical applications for AI and blockchain and how to approach such innovations.We demonstrate the right use of each technology to bring out their benefits when applied appropriately and to understand the relationships of dated hypotheses with respect to real-world data, including historical data against forward-looking market data and their impact on improved projections. We also discuss improvements for client onboarding processes, construction and management of portfolios, personalization of services, clearing and settlements of trades and on the overall reporting for compliance.
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There is a strong belief formed in scholarly and policy circles that contemporary capitalism is the source of many economic, social and political problems that plague the world today. This system is blamed for large inequalities between... more
There is a strong belief formed in scholarly and policy circles that contemporary capitalism is the source of many economic, social and political problems that plague the world today. This system is blamed for large inequalities between the rich and the poor, unrestrained profit-seeking without moral, ethical and social considerations, venal accumulation of income and wealth, and environmental destruction. The argument that capitalism drives innovation and attracts investment is now weakend substantially by these systemic global problems that pose existential threat to human societies. It is clear that the world cannot continue on the current trajectory and needs to harness other forms of managing its resources to create a balance between, self-love, profit motive, ambition on the one hand, and moral, ethical, social responsibility and environmental accountability, on the other. “Islamic economics” has been suggested as providing a basis for one such alternative syatem. However, it is argued here that the present paradigm of “Islamic economics” needs to change its orientation away from its current “Islamization of knowledge” methodology toward a paradigm more attuned to the Qur’an’s vision of society and its economy in order to provide a viable and sustainable set of solutions to human problems. A move in this direction requires consideration of elements of this vision that have not been been explored thus far in presentations of the discipline of “Islamic economics.”
This note is an exploratory consideration of one such fundamental elements derived from the Qur’an: the idea of spiritual capital — as the organizing element of effective and efficient utilization of social, human and financial capital — as a step toward initiating a paradigm shift in investigating the Qur’an’s vision of how societies should manage their resources.
This note is an exploratory consideration of one such fundamental elements derived from the Qur’an: the idea of spiritual capital — as the organizing element of effective and efficient utilization of social, human and financial capital — as a step toward initiating a paradigm shift in investigating the Qur’an’s vision of how societies should manage their resources.
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This conceptual paper assesses the key features of the AI and blockchain architecture and protocol developments in capital markets. It identifies areas where AI and blockchain can bring substantial transformational change, while at the... more
This conceptual paper assesses the key features of the AI and blockchain architecture and protocol developments in capital markets. It identifies areas where AI and blockchain can bring substantial transformational change, while at the same time, identify some of the major barriers to adoption within the capital market sector. The AI + blockchain model is envisioned to scale the complex levels of human activity, along with its transactional activities, which could further establish a truly risk-sharing and just economy.
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This paper investigates the degree of compliance of individual behavior to the Islamic commandment of 'commanding right and forbidding wrong', through a behavioral approach, to understand the pervasiveness of Islamic morality in our... more
This paper investigates the degree of compliance of individual behavior to the Islamic commandment of 'commanding right and forbidding wrong', through a behavioral approach, to understand the pervasiveness of Islamic morality in our modern societies, and how Muslims actually behave as opposed to what the Qur'an prescribes for them. The methodology of this research evaluates the actions of experiment participants (divided into religious affiliations) through a Rowing Game that was intended to test for the rule of 'commanding right and forbidding wrong'. “The game is a prototype of a social contract where it illustrates how 'mutual undertakings' create a psychological tension between individual rationality, group benefit and straightforward compliance to Allah's commandment” (Mohamed et al, 2018). The complex nature of this command and prohibition results from the varied understanding of who is responsible (and adept enough) to enforce it, during which time is appropriate to do so and by what means. In this particular experiment, Muslims and non-Muslims appear to perform the same, with negative priming effects for Muslims and positive priming effects for non-Muslims.
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FinTech and the digital economy offer opportunities for ASEAN to rebuild trust and confidence in a financial system that had lost them. Some technologists imagine this world without intermediaries, while others just want a faster and more... more
FinTech and the digital economy offer opportunities for ASEAN to rebuild trust and confidence in a financial system that had lost them. Some technologists imagine this world without intermediaries, while others just want a faster and more efficient way of transacting. Banks, FinTech companies, and regulators need to collaborate to create an ecosystem to drive greater access to financial services in the integrated ASEAN economy. The author discusses projected trends in technology and its use in the next few crucial years. He also recommend strategies that involve various market participants and stakeholders coming together and working towards shared goals of a unified ASEAN economic community by increasing financial inclusion for the unbanked and the seamless cross-border flow of goods, services, and payments in a safe and secure manner.
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Fairness is one of the central institutional pillars of Islamic law, and its inherent legal framework dictates, among other things, clarity and ethical behaviors in all our endeavors. Righteous behaviors form the foundation of fairness... more
Fairness is one of the central institutional pillars of Islamic law, and its inherent legal framework dictates, among other things, clarity and ethical behaviors in all our endeavors. Righteous behaviors form the foundation of fairness and justice. This paper attempts to address deep religious understanding in human behavior for fairness and justice so as to use religious values in productive economic behaviors, like the sharing of risk and benefits in mutual agreements. The methodology of this study assesses the behavior of the subject pool (players representative of Muslims and non-Muslims) through the Ultimatum Game that was designed to test for fairness and experiment in decision-making to measure fairness in economic transactions. In terms of fairness in contracting, non-Muslims performed a little bit better than Muslims but there were significant differences between the primed and unprimed subjects in the Muslim and non-Muslim groups where it was positive for the Muslim group and negative for the non-Muslim group.
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This paper sets macro-level and micro-level operational indicators for socioeconomic development through a Maqāṣid al-Sharī'ah framework. It also sets forth six broad recommendations and nine specific initiatives within a four-dimensional... more
This paper sets macro-level and micro-level operational indicators for socioeconomic development through a Maqāṣid al-Sharī'ah framework. It also sets forth six broad recommendations and nine specific initiatives within a four-dimensional framework for institutional governance, particularly for socioeconomic development policy. A lattice of multidimensional indicators and multipronged initiatives are proposed to address the multifaceted dimensions of institutional governance and the various transmission channels that influence socioeconomic policy. While empirical studies have demonstrated the importance of institutions and ethics in socioeconomic development, the pressing issue remains how deep Maqāṣid al-Sharī'ah understanding in human decision-making can be developed to influence behaviors that are efficient, inclusive, moral, and trustworthy that leads to peace, prosperity and progress. This paper attempts to address this concern.
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A national study via a public survey (social media) in 2016 and a closed-door survey of industry players in 2017 revealed the public perception of responsible finance and islamic finance in singapore. these... more
A national study via a public survey (social media) in 2016 and a closed-door survey of industry players in 2017 revealed the public perception of responsible finance and islamic finance in singapore. these surveys were conducted by Pergas investments Holdings.
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A concern that has emerged repeatedly in the support for long-term sustainable development is the insufficient availability of long-term finance for projects such as infrastructure. This paper considers some of the possible strategies to... more
A concern that has emerged repeatedly in the support for long-term sustainable development is the insufficient availability of long-term finance for projects such as infrastructure. This paper considers some of the possible strategies to overcome obstacles (cognitive or otherwise) to ensure the provision of long-term financing. The author discusses several behavioral interventions to surmount hurdles both from the demand and supply sides as well as creating enabling environments for better access to finance. This effectively requires challenging the rationale underlying private financial flows that are driven by short-term profits and rents, and strengthening mechanisms for mobilizing and allocating both domestic and external finance for value creation and development over a longer time horizon. It also involves properly designed projects that contractually distributes risks and shares returns within economically rational financing structures and create the right incentives for the various partners.
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We discuss a multi-dimensional approach to achieve financial inclusion and shared prosperity, and list the five key areas that need to be developed in order for us to holistically secure a just and prosperous future for all. The critical... more
We discuss a multi-dimensional approach to achieve financial inclusion and shared prosperity, and list the five key areas that need to be developed in order for us to holistically secure a just and prosperous future for all. The critical components of the financially inclusive future are financial literacy and access to financial services, income and wealth redistributive instruments, development of micro, small and medium enterprises (MSMEs), a sound legal and enforcement system to ensure these take place ethically, and lastly an adequate metric-set to measure effectiveness, performance and progress of such initiatives.
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At the outset, all macroprudential policies like limits on credit growth and other balance sheets restrictions, (countercyclical) capital and reserve requirements and surcharges, caps on loan to value ratios, levies and taxes, are part of... more
At the outset, all macroprudential policies like limits on credit growth and other balance sheets restrictions, (countercyclical) capital and reserve requirements and surcharges, caps on loan to value ratios, levies and taxes, are part of the policy implementation in emerging, developed and advanced markets alike, even in Islamic Finance. These policies are motivated by market failures and externalities, but sometimes they can be hard to identify and unfortunately even more difficult to time. Chief among the benefits of these tools are that they can reduce procyclicality and limit systemic risks. But, policy makers need to coordinate these macroprudential policies with other policies, such as monetary and microprudential ones. We discuss how to best adapt these tools to specific country circumstances, drawing examples relevant to Asia and the GCC, following the repercussions from Euro and U.S. interventionist policies (i.e. expansion and reduction in global liquidity through QE and its subsequent taper). Some institutional reforms to address the cyclical behavior of our present economy are proposed and timely early warning indicators are discussed. At the end, we touch on behavioral-based approaches for the future.
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Contemporary Islamic Finance today has expounded much on the different financial transactions to be shari'ah-compliant based on the maqasid (goals and objectives) of the Shari'ah Law. Although much have been written and practiced on the... more
Contemporary Islamic Finance today has expounded much on the different financial transactions to be shari'ah-compliant based on the maqasid (goals and objectives) of the Shari'ah Law. Although much have been written and practiced on the more common contracts of mudarabah, musyarakah, ijarah, wakalah, istisna, salam, qard, tawarruq, and the concepts of waqf, takaful, etc., not much literature can be found on other less popular concepts and contracts such as ju'alah, musaqah, and so on. In order to expand Islamic legal theory and practice in fiqh al-mu'amalat (the jurisprudence of financial transactions), this study is aimed inter alia to address the legal basis of, specifically the Ju'alah contract, its pillars and conditions, invalidity and issues as well as how the application of such contracts are already being applied in the Islamic financial transactions as modern Islamic financial products and as business practices.
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This presentation considers some basic insights from behavioral experiments / observations and their implications for consumer protection. It outlines some fundamental features of the social and institutional environments in which... more
This presentation considers some basic insights from behavioral experiments / observations and their implications for consumer protection. It outlines some fundamental features of the social and institutional environments in which consumers interact, and discusses the behavioral tendencies, and potential failures, likely to arise in such contexts. Of particular interest, is the conflict that arises from the experimental findings and standard assumptions about human agents that typically guide economics and policy. A behavioral perspective highlights the ability of a behaviorally informed and insightful design and regulation of consumer protection to improve consumer welfare. This is to be done without affecting market competitiveness.
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Sustainable development has been focused mostly on protecting the environment for future generations with the goal of preserving scarce resources. A more sustainable development strategy goes beyond just climate change, but embraces... more
Sustainable development has been focused mostly on protecting the environment for future generations with the goal of preserving scarce resources. A more sustainable development strategy goes beyond just climate change, but embraces sustainable practices within the economy, which concerns equality, justice and risk-sharing that will bring about long-term socio-economic change. In order for sustainability to be holistic, there must be an assessment into what causes unsustainability. We deliberate on five of them.
In this chapter, we discuss nine types of innovative sustainable financing that will help individuals and businesses achieve long-term sustainable objectives. We then provide an analysis on innovative Green Financing Programs for the agriculture sector in Indonesia.
In this chapter, we discuss nine types of innovative sustainable financing that will help individuals and businesses achieve long-term sustainable objectives. We then provide an analysis on innovative Green Financing Programs for the agriculture sector in Indonesia.
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Following the success of the first edition that brought attention to the digital revolution in Islamic financial services, comes this revised and updated second edition of Blockchain, Fintech and Islamic Finance. The authors reiterate the... more
Following the success of the first edition that brought attention to the digital revolution in Islamic financial services, comes this revised and updated second edition of Blockchain, Fintech and Islamic Finance. The authors reiterate the potential of digital disruption to shrink the role and relevance of today’s banks, while simultaneously creating better, faster, cheaper services that will be an essential part of everyday life. Digital transformation will also offer the ability to create new ways to better comply to Islamic values in order to rebuild trust and confidence in the current financial system.
In this new edition, they explore current concepts of decentralized finance (DeFi), distributed intelligence, stablecoins, and the integration of AI, blockchain, data analytics and IoT devices for a holistic solution to ensure technology adoption in a prudent and sustainable manner. The book continues to discuss crucial innovation, structural and institutional developments for financial technologies including two fast-growing trends that merge and complement each other: tokenization, where all illiquid assets in the world, from private equity to real estate and luxury goods, become liquid and can be traded more efficiently, and second, the rise of a new tokenized economy where inevitably new rules and ways to enforce them will develop to fully unleash their capabilities. These complementary and oft-correlated trends will complete the decentralization of finance and will influence the way future financial services will be implemented.
Updated materials with 3 NEW chapters:
Chapter 7: Data Risk Management For Advanced Islamic Financial Institutions
Chapter 10: Cash Waqf (Endowments) Management Through the Blockchain
Chapter 11: A Unified Islamic Digital Currency – The Digital Dinar
In this new edition, they explore current concepts of decentralized finance (DeFi), distributed intelligence, stablecoins, and the integration of AI, blockchain, data analytics and IoT devices for a holistic solution to ensure technology adoption in a prudent and sustainable manner. The book continues to discuss crucial innovation, structural and institutional developments for financial technologies including two fast-growing trends that merge and complement each other: tokenization, where all illiquid assets in the world, from private equity to real estate and luxury goods, become liquid and can be traded more efficiently, and second, the rise of a new tokenized economy where inevitably new rules and ways to enforce them will develop to fully unleash their capabilities. These complementary and oft-correlated trends will complete the decentralization of finance and will influence the way future financial services will be implemented.
Updated materials with 3 NEW chapters:
Chapter 7: Data Risk Management For Advanced Islamic Financial Institutions
Chapter 10: Cash Waqf (Endowments) Management Through the Blockchain
Chapter 11: A Unified Islamic Digital Currency – The Digital Dinar
Research Interests:
This research focuses on the modern HMIS' ability to improve the operational efficiency of health-care facilities, generation, and use of medical data for the benefit of its citizens and stakeholders, electronic record-keeping, and the... more
This research focuses on the modern HMIS' ability to improve the operational efficiency of health-care facilities, generation, and use of medical data for the benefit of its citizens and stakeholders, electronic record-keeping, and the ability to share the data across various systems. Such a system will involve blockchain transactions and the immutable tracking of services extended. In the proposed configuration, the modern HMIS is built to allow data consolidation and improve health-care services and clinical research. The use of data analytics will reduce errors and improve clinical decision making and universal access to critical medical information in real time. Flexibility and the ability to interface and integrate to other systems will play a crucial role in data access and ultimately the cornerstone of an efficient medical record- keeping system. Such a system not only manages the clinical information but it will also manage pharmacy supplies, efficiently dispatch hospital services such as nurse management of the patient, bed transfers, radiography, consultation tracking which will all be integrated into the HMIS modules with real-time visibility via a shared dashboard.
Research Interests:
The research discusses current and potential applications of artificial intelligence (AI) for risk management in Islamic finance. The paradigm shifts brought on by digital transformation is altering the customers’ behaviors towards... more
The research discusses current and potential applications of artificial intelligence (AI) for risk management in Islamic finance. The paradigm shifts brought on by digital transformation is altering the customers’ behaviors towards financial services and how it is being managed and deployed. We cover the techniques of risk management that encompass asset and liability management (ALM) risk, credit risk, market risk, operational risk, liquidity risk, regulatory and Shariah risk compliance within the financial industry, across sectors. We also recognize AI’s ability in combatting financial crime such as monitoring trader recklessness, anti-fraud and anti-money laundering. The capacity of machine learning (ML) to examine huge amounts of data allows for greater granular and profound analyses in various financial products and services. We also note that using AI itself adds another dimension of risk in the financial risk management framework. We conclude with some practical limitations within financial institutions pertaining to acceptance, competency and readiness.
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The authors analyze the comparative behaviors of Muslims and non-Muslims by employing selected behavioral and experimental games to examine the level of adherence to the rules of behavior in the society. There is an increasing interest in... more
The authors analyze the comparative behaviors of Muslims and non-Muslims by employing selected behavioral and experimental games to examine the level of adherence to the rules of behavior in the society. There is an increasing interest in behavioral economics and behavioral finance, which hold the potential of providing plausible explanations to the question of how emotions affect markets but also how to enhance constructive behavioral norms. The focus in behavioral finance is made on the impact of emotions, framing bias, heuristics and market forces on investment decisions, firm behavior, market regulation, and education policy. The experimental games are based one the premise that Islamic economy is a rules-based system and the compliance to such rules of behavior does not only improve economic performance and social welfare but helps also individuals in achieving higher potentials. Indeed, the adherence to a rules-based system has the potential of reducing cognitive and psychological biases. The selected set of seven rules (Capstone Rule, Cooperation, Contract, Property Rights, Reciprocity, Golden Rule and Trust) can also be used to examine market failures such as those related to negative externalities from narrow decision-making, and can be useful also in the design of viable solutions based on ethical, social and legal considerations.
Research Interests:
The rise of disruptive digital technologies for financial services, like peer-to-peer (P2P) crowdfunding, indicates new ways to access alternative financing over traditional financing. This research contributes to the nascent literature... more
The rise of disruptive digital technologies for financial services, like peer-to-peer (P2P) crowdfunding, indicates new ways to access alternative financing over traditional financing. This research contributes to the nascent literature on digital finance in real estate crowdfunding, and its potential of being applied to public housing. The idea of such a platform on the blockchain is this paper’s second conceptual innovation. The rationale is to illustrate the significance of crowdfunding to alternative financing even for the public sector, and how blockchain technology might improve the weaknesses of crowdfunding. The real estate industry needs to embrace new solutions, capable of dealing with its traditional problems and to increase efficiency, sustainability, accountability and prevent market failures within the economy. In this new market environment, we review real estate crowdfunding acceptance in the US, Europe and Asia as well as conceptualize tech-enhanced platform that adopts the blockchain to improve the crowdfunding process for real estate public housing. This can be achieved by exploring new peer-to-peer (P2P) opportunities with better management of information and reduction in origination costs.
Research Interests:
With increasingly high levels of client expectations, the need for quick, secure and highly personalized solutions is vital. High-net- worth individuals (HNWIs) and wealth management clients have become accustomed to highly personalized... more
With increasingly high levels of client expectations, the need for quick, secure and highly personalized solutions is vital. High-net- worth individuals (HNWIs) and wealth management clients have become accustomed to highly personalized services by their portfolio managers, who do so through a support network of connected channels and integrated systems.
Attaining a holistic evaluation of the client’s portfolio and using automated recommendations to advance engagement for further improvements can be quickly and efficiently done with advanced technologies like AI and blockchain.
In this chapter, we provide a short discussion of AI and blockchain applications in Islamic portfolio management and understand the benefits and the shift in processes, as well as the challenges that need to be overcome for practical applications for AI and blockchain and how to approach such innovations.
Attaining a holistic evaluation of the client’s portfolio and using automated recommendations to advance engagement for further improvements can be quickly and efficiently done with advanced technologies like AI and blockchain.
In this chapter, we provide a short discussion of AI and blockchain applications in Islamic portfolio management and understand the benefits and the shift in processes, as well as the challenges that need to be overcome for practical applications for AI and blockchain and how to approach such innovations.
Research Interests:
Financial reform in the last few decades has transformed the global operations of finance watched over by a reactive regulatory framework, in a concerted effort to enhance the resilience of institutional structure, recapture market trust... more
Financial reform in the last few decades has transformed the global operations of finance watched over by a reactive regulatory framework, in a concerted effort to enhance the resilience of institutional structure, recapture market trust and improve the critical supporting infrastructure to the economy. Many financial institutions are struggling with ever-changing regulatory requirements and the increased burden of intricate rules. Such rules can be conflicting, and subjected to local implementation and jurisdictic interpretation. Non-compliance or the inability to meet the deadlines subject institutions to hefty penalties and multimillion-dollar fines for failures in controlling nefarious and over-the-counter trading activities. In this chapter, we map out ongoing regulatory milestones globally to understand the main supervisory priorities by territory and propose how financial institutions can successfully administer regulatory change through an AI-driven regulatory management model within their organizations. We discuss the evolution, challenges and recommendations for financial institutions (including Shariah compliance) in the change management for regulations using a structured approach that addresses regional priorities.
Research Interests:
This chapter proposes to discuss how artificial intelligence and other technologies can be developed as a practical moral technology to advance the idea that an information technology of morality and ethics is possible (and necessary),... more
This chapter proposes to discuss how artificial intelligence and other technologies can be developed as a practical moral technology to advance the idea that an information technology of morality and ethics is possible (and necessary), where technology can be used as a tool in moral action itself. Since artificial intelligence technologies and its applications are a kind of automated problem-solving machine, and moral deliberations are a kind of problem, it was inevitable that automated technologies used as moral systems would emerge.
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The main messages embedded in Part I of this volume are empowerment through Islamic financial inclusion, contribution of Islamic microfinance in achieving Sustainable Development Goals, and how Islamic finance tackles income and wealth... more
The main messages embedded in Part I of this volume are empowerment through Islamic financial inclusion, contribution of Islamic microfinance in achieving Sustainable Development Goals, and how Islamic finance tackles income and wealth inequality. Part II provides empirical cases of Islamic finance as a vehicle for social inclusion, for improving access to financial inclusion, and for the design of appropriate products for farmers as well as entrepreneurship.
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This Edited Book contains 9 best papers selected from 78 papers submitted which come from various countries. The best papers are divided into three categories namely Islamic Economic Development, Islamic Financial Instruments and... more
This Edited Book contains 9 best papers selected from 78 papers submitted which come from various countries. The best papers are divided into three categories namely Islamic Economic Development, Islamic Financial Instruments and Technology, and Islamic Social Finance.
Research Interests:
The digital revolution in financial services is under way, and digital disruption has the potential to shrink the role and relevance of today’s banks, while simultaneously creating better, faster, cheaper services that will be an... more
The digital revolution in financial services is under way, and digital disruption has the potential to shrink the role and relevance of today’s banks, while simultaneously creating better, faster, cheaper services that will be an essential part of everyday life. This forward-looking book discusses the crucial innovation, structural and institutional development for financial technologies (fintech) in Islamic finance.
The authors explain concepts in fintech and blockchain technology and follow through with their applications, challenges and evolving nature. The book provides insights into technology which will enable and enhance actual prescribed Islamic behaviors in modern economic transactions. Case studies highlight how to cope with modern transactional behavior with the advent of global online/mobile markets, shorter attention spans, and impersonal trade exchange.
The authors explain concepts in fintech and blockchain technology and follow through with their applications, challenges and evolving nature. The book provides insights into technology which will enable and enhance actual prescribed Islamic behaviors in modern economic transactions. Case studies highlight how to cope with modern transactional behavior with the advent of global online/mobile markets, shorter attention spans, and impersonal trade exchange.
Research Interests:
This book investigates how people make decisions in transactional scenarios, and examines their choices against the universal rules of prescribed behaviors. It applies game theory to realistically understand the fallibilities of the... more
This book investigates how people make decisions in transactional scenarios, and examines their choices against the universal rules of prescribed behaviors.
It applies game theory to realistically understand the fallibilities of the human being and how markets and societies function, and use these observations to provide recommendations for effective behavioral governance for any corporation or any institution.
It applies game theory to realistically understand the fallibilities of the human being and how markets and societies function, and use these observations to provide recommendations for effective behavioral governance for any corporation or any institution.
Research Interests:
This Handbook is designed to provide practical information on the available alternative sources of loan and equity funding that are more suited to the financing needs and requirements of MSMEs in ASEAN, and serves as a comprehensive... more
This Handbook is designed to provide practical information on the available alternative sources of loan and equity funding that are more suited to the financing needs and requirements of MSMEs in ASEAN, and serves as a comprehensive guidebook and checklist to improve financial awareness and basic financial literacy to MSMEs by providing clear guidance on how to develop a business plan and effectively pitch their proposals to potential lenders and investors.
Research Interests:
Chapter 49 of the Qur’an (al Hujarat) establishes the position of Rasulullah ﷺ as the Messenger of Allah (s.w.t.) and then details the prescribed rules of behavior. We first identify the different rules of behavior that the Surah... more
Chapter 49 of the Qur’an (al Hujarat) establishes the position of Rasulullah ﷺ as the Messenger of Allah (s.w.t.) and then details the prescribed rules of behavior. We first identify the different rules of behavior that the Surah highlights in accordance to the events that occur to the Prophet ﷺ. The Surah also defines a Muslim identity by its Belief system, preaching the outward and inward code of conduct prescribed by Allah (s.w.t.). We present arguments that if complied with its substance, this Chapter in and of itself can establish a just, harmonious and secure society.
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The proposal for a Digital Dinar – a unified Islamic currency in digital form ― is to achieve the goal of a unified Islamic economy to improve trade between Islamic nations as well as improve the rights and sovereignty of its citizens. In... more
The proposal for a Digital Dinar – a unified Islamic currency in digital form ― is to achieve the goal of a unified Islamic economy to improve trade between Islamic nations as well as improve the rights and sovereignty of its citizens. In the full version found in the book, we propose two constructs for the Islamic digital currency (digital dinar) ― an Aggregated Sovereign Currencies Construct and the Basket of Commodities Construct.
Research Interests:
Artificial intelligence, blockchain and other potentially disruptive technologies form the crucial innovation, structural and institutional foundation for not only economic development, but also moral development and practical ethics. The... more
Artificial intelligence, blockchain and other potentially disruptive technologies form the crucial innovation, structural and institutional foundation for not only economic development, but also moral development and practical ethics. The integration of blockchain and AI [artificial intelligence] into a decentralized intelligence system has profound possibilities to employ data in innovative ways. An effective amalgamation of both technologies with IoT [internet of things] devices will enable faster and seamless data management, validation of transactions and detection of illegal activities, among others.