Global Islamic Finance Report 2021 being launched at the 8th Indonesia Sharia Economic Festival

(London, UK). The year, amidst the pandemic Cambridge Institute of Islamic Finance once again managed to launch the Global Islamic Finance Report (GIFR), the oldest yearbook in Islamic banking and finance, in Jakarta, Indonesia.

GIFR is a valuable resource for Islamic financial intelligence and the most influential and respected annual report in Islamic finance globally. GIFR has the unique recognition of being the first report to have documented the size and growth of the global Islamic financial services industry since its inaugural edition in 2009.

GIFR 2021 takes up the topic of “Islamic Finance in a Post-COVID World” following the last year’s theme of “Islamic Finance for Socio-economic Inclusion and Sustainable Development in a timely and apt manner. The pandemic has adversely affected every aspect of human life, with the financial services industry taking the most hit. On the other hand, this has also widened the scope of innovation for Islamic finance to start looking into new avenues of growth, especially Islamic social finance. It is expected that the sukuk related with CSG, Green, SDG and COVID-19 Response will play an important role in the next five years. The Islamic banking and finance industry will therefore have to not only adapt to a new normal but also innovate in the face of the FinTech revolution.

Since 2019, the global Islamic financial services industry has been steadily growing at an average rate of 11.38% per annum but its growth has significantly slowed down in the last five years, achieving only 6.54% annually, partially due to the ongoing pandemic. The global Islamic financial services industry nearly touched the historical milestone of US$3 trillion at the end of 2020. The estimated Islamic financial AUM as of December 31, 2020, was US$2.941 trillion, exhibiting annual growth of 7.61%, which is also the highest annual increase in the last 5 years.

Another distinguishing feature of GIFR is Islamic Finance Country Index (IFCI), which has been published annually in the report since 2011. IFCI is the oldest index for ranking different countries with respect to the state of IBF and their leadership role in the industry on a national level and benchmarked to an international level. This year’s IFCI is based on our 2011 index, with two major adjustments in the methodology over the last 10 years.

Indonesia is now considered as a player with potential to lead the global Islamic financial services industry. Indonesia tops the IFCI ranking with 83.35 score, overtaking Malaysia once again. Interestingly, Saudi Arabia took the second position pushing Malaysia to the third spot. Iran, Sudan and Pakistan are at number 4, 5 and 6 respectively.

Kazakhstan slipped three positions to occupy the 17th position. Lebanon took the 23rd position after climbing up three spots. The Kyrgyz Republic and Tajikistan are the new entrants on this list occupying the 34^th and 40^th positions respectively.

Pakistan - one of the top 10 Islamic financial markets according to our Islamic Finance Country Index (IFCI) recorded a 30% growth in Islamic banking assets in 2020, along with growth of 27.8% in deposits. This was the highest annual increase in assets since 2012 and in deposits since 2015, withering away the impact of the pandemic. Financing by Islamic banking institutions – both fully-fledged Islamic banks and Islamic banking windows of conventional banks – also grew by 16%.

GIFR 2021 includes chapters on digital technology and its potential in Islamic social finance, leveraging Islamic social finance to achieve the SDGs, climate remediation and circular economy, gold-based productive waqf and much more.

GIFR 2021 is supported by DDCAP Group, Qatar Financial Centre, Gatehouse Bank and Fair FinTech Inc. This year’s report is jointly produced by Cambridge-IIF and Ajman University Centre for Excellence in Islamic Finance, while Minhaj University Lahore has served as Special Knowledge Partner for the third consecutive year.

To obtain a copy of GIFR 2021, or for further information please contact: gifr@cambridge-ifa.net 

Cambridge Institute of Islamic Finance – Cambridge-IIF – is an independent research centre, specialising in the financial sectors of the countries wherein Islamic banking and finance is a significant activity. Leveraging upon the academic resources the city of Cambridge has to offer, Cambridge-IIF is well-positioned to undertake research projects to study the global phenomenon of Islamic banking and finance. Cambridge-IIF aims at conducting policy-oriented research to further spur growth in Islamic banking and finance, with a special focus on the Sustainable Development Goals (SDGs).

Cambridge IFA is a financial services intelligence house that specialises in developing and utilising powerful cutting-edge analytical tools to evaluate business data, assess macroeconomic indicators and understand market trends, leadership positioning and brand development relevant to the development of the financial services industry globally.

Formed by Ajman University in 2020, AU-CEIF aims at being a world leading source of information, education, training and applied industry research in the field of Islamic banking and finance. Through AU-CEIF, Ajman University actively pursues the agenda of provision of an excellent and innovatively inclusive learning environment for all stakeholders relevant to the entire Islamic finance ecosystem, in a socially responsible manner following highest standards of integrity.

© Press Release 2021