Qatar uses digital tools to make Islamic finance more transparent, and easier to access worldwide

By Sadiq Abdulfatah

Qatar, which has built one of the strongest Islamic finance ecosystems in the world, has tokenized sukuk and digital takaful platforms, enhancing transparency and global access as well as improving settlement speed and risk-sharing, according to a top official of the Qatar Financial Centre (QFC).

Addressing the 8th International Conference on Islamic Finance, organised by Hamad bin Khalifa University, QFC Authority chief executive officer Yousef Mohamed al-Jaida said digital investment platforms are providing automated, Shariah-compliant portfolios; while crowdfunding platforms are enabling ethical investments in real estate and social impact projects.

“We have tokenised sukuk and digital takaful platforms that are not only enhancing transparency but improving settlement speed and risk-sharing in real time,” he said, adding the extent of how emerging technologies, like blockchain, can expand Islamic finance is “limitless”

Smart contracts and AI (artificial intelligence)-driven Shariah advisory tools can automate compliance and auditing, while cross-border digital settlement corridors and tokenised real-economy assets can enhance efficiency and global access.

Stressing that innovation in the industry will only accelerate; he said what’s important now is to ensure that technological advancements are integrated without compromising the core principles of Islamic finance, to preserve its integrity.

“At the QFC, we are actively shaping this future. Through initiatives such as our Digital Assets Lab and the QFC Digital Assets Framework, we are building an enabling ecosystem for digital assets — from tokenisation and smart contracts to custody solutions. These efforts create a space where Islamic finance can harness innovation while remaining firmly aligned with Shariah principles,” according to him.

In this regard, he said a recent development on the platform is the launch of a proof of concept for a blockchain-based digital receipt system, designed to enhance efficiency and regulatory compliance in Shariah-compliant asset-backed finance.

This development was enabled through the collaboration of a consortium of partners — AlRayan Bank, Blade Labs, and Hashgraph — each contributing unique expertise to a shared vision of financial innovation.

Highlighting that the global Islamic finance assets are projected to reach $7.5tn by 2028, al-Jaida said to broaden access to Islamic finance, there is a need to strengthen international cooperation and harmonise standards.

Finding that Shariah governance models vary across jurisdictions, which create uncertainty and compliance burdens for businesses and investors, holding back cross-border investments; he said regulations “do not need to be identical; they only need to be in harmony” to establish clarity and promote confidence.

Highlighting that Qatar and the QFC are committed to achieving this locally; he said the QFC has established a comprehensive framework aligned with the AAOIFI (Accounting and Auditing Organisation for Islamic Financial Institutions) standards, covering risk management, corporate governance, and the prohibition of non-compliant activities.

Al-Jaida said the ethical principles of Islamic finance are particularly relevant today because addressing economic instability and social inequality requires equity and shared responsibility.

These values are embedded in Shariah-compliant instruments, which, when applied effectively, can enhance institutional resilience, enable more inclusive wealth distribution, and align economic growth with sustainability, according to him.

“The country has built one of the strongest Islamic finance ecosystems in the world, with two of its fully pledged Islamic banks among the largest in the region by asset size, alongside a growing network of Islamic finance companies, Shariah-focused investment firms, takaful providers, and Shariah-compliant investment funds,” he said, adding Islamic finance is also a priority within the Qatar Third Financial Sector Strategic Plan.

A central component of this strategy is to integrate Islamic finance more deeply across banking, insurance, capital markets and digital finance, while raising awareness and expanding its visibility both locally and internationally, according to him.

Source: Gulf Times