Shari’ah Scholar’s call for “innovation”zulkiflihasan
Sh Dr Mohamed Daud Bakar calling for “innovation”
By Tabdulbasser Available at: http://www.straightwayethical.com/blog/
The Islamic Globe has an interesting article on Dr Mohamed Daud Bakar’s call for “innovation” in the shari`ah compliant finance sector.
A Malaysian Shari’ah scholar has called the industry to task over its lack of innovation. Kuala Lumpur-based Dr. Mohamed Daud Bakar, who is also MD of Amanie Islamic Finance Consultancy, told The Islamic Globe that: “The industry needs to develop products that appeal to most consumers, if not all consumers. And the only way it can do this is to innovate.”
Bakar said there was a need to develop new asset classes, including Shari’ah compliant access to private equity, and real estate products that have the ability to invest in multiple global markets in one fund.
He also said that Shari’ah screening has to be improved and the industry should roll-out investment fund platforms, a move that revolutionized the conventional industry. Bakar said that new, innovative Sukuk structures should be developed. He was involved in the $164m Gulf Investment Corporation Sukuk recently issued in Malaysia, which was structured on a hybrid Murabahah/Wakala contract, the kind of structure that the industry needs to embrace if it is going to move forward in the next decade.
Mark Smyth, MD of Failaka Advisors added: “There needs to be increased emphasis on building an asset management business, distribution networks and old-fashioned salesmanship. The industry needs to step out of the lecture hall and into real people’s living rooms and places of business.”