MUHAMMADIYAH.OR.ID, YOGYAKARTA – Habib Ahmed, the Sharjah Chair in Islamic Law & Finance at Durham University, the United Kingdom, delivered an insightful lecture on the current challenges confronting the Islamic finance industry. Taking place at Universitas Muhammadiyah Yogyakarta (UMY) on September 29, he emphasized the need for the sector to maintain its distinctive identity rather than merely emulating conventional financial products.
A prominent issue highlighted by Ahmed is the imperative for Islamic finance to uphold its unique identity, firmly rooted in Sharia compliance. He stressed the significance of conveying to the public that Islamic finance is deeply entrenched in Islamic values and offers financial solutions that align seamlessly with religious principles.
Furthermore, Ahmed contended that Islamic finance must transcend its conventional role as a provider of financial products to play a more substantial role in global economic growth and contribute to achieving the Sustainable Development Goals (SDGs) in a rapidly evolving world.
“Islamic finance has to transcend being a mere financial service. It should be a manifestation of profound Islamic values, especially in its steadfast adherence to the prohibition of riba (interest). Islamic finance should stand as a choice that not only complies with religious principles but also offers superior financial products and services,” said Ahmed.
In concluding his lecture at the visiting lecture for the International Program for Islamic Economics and Finance at UMY, Ahmed highlighted three pivotal points. First, he stressed the importance of redefining Sharia compliance by integrating maqasid (purposes) that generate value for clients.
Second, Ahmed urged Islamic finance to embody the principle of “rahmatan lil alamin” (mercy to the whole world), indicating the industry’s potential to benefit a broad spectrum of individuals and communities.
Last, he emphasized the critical role of innovation in shaping the narrative of Islamic financial literacy. Innovation should extend across organizational structures, product offerings, and marketing and sales strategies to effectively convey the story of Islamic finance’s unique value proposition to a global audience.