Indonesian, Malaysian firms told to invest in PH Islamic finance

The Bangko Sentral ng Pilipinas (BSP) and the Asian Development Bank (ADB) encouraged representatives from the Indonesian and Malaysian business sectors to take advantage of Islamic finance opportunities in the Philippines.

Both the BSP and the ADB highlighted the Philippines’ readiness to accept investments for and grow its Islamic finance sector. The two institutions held roadshows in Kuala Lumpur from Sept. 23 to 25 and in Jakarta from Sept. 17 to 19, 2024.

The BSP earlier introduced regulatory reforms to encourage greater participation in Islamic banking by both domestic and foreign banks.

The central bank said it also supports the entry of new players in the Islamic finance sector as part of its broader commitment to enhance financial inclusion and foster economic development in the country, especially in the Bangsamoro Autonomous Region in Muslim Mindanao.

BSP Deputy Governor Chuchi Fonacier said that “beyond serving a niche market, our vision extends to building a comprehensive Islamic financial system that provides ethical financial solutions that benefit everyone regardless of faith.”

BSP assistant governor Arifa Ala told the Indonesian Chamber of Commerce and Industry that “the Philippines is ready and fully committed to building a vibrant Islamic finance ecosystem, and together, we can unlock the full potential for expanded financial inclusion.”

ADB senior counsel Maria Cecilia Sicangco and finance specialist Mohammad Farrukh Raza presented Islamic finance opportunities in the Philippines from the ADB-commissioned report, “Unlocking the Potential of Islamic Finance in the Philippines: A Market Analysis and Landscape Report.”

Around 100 senior executives from Islamic banks, fintech companies, industry associations, lawmakers, standard-setting bodies and regulatory authorities attended the roadshows.

Separate meetings were also held to present the Philippines’ positive economic outlook that complements the government’s proactive and calibrated approach in developing and growing the local Islamic finance industry.