Malaysia To Champion Islamic Fintech, Climate-oriented Sukuk By 2040 -- DPM Fadillah

KUALA LUMPUR, Nov 18 (Bernama) -- Malaysia aspires to be the global benchmark for regulation, innovation and Islamic environmental, social and governance (ESG) as well as a centre of excellence for Islamic fintech (financial technology) and climate-oriented sukuk by 2040, said Deputy Prime Minister Datuk Seri Fadillah Yusof.

He said the global financial landscape is evolving and Islamic finance is poised to lead a new frontier, with Malaysia’s direction aligned with global megatrends. 

Fadillah noted that Islamic finance will underpin Malaysia’s climate architecture, enabling transition, green and blue sukuk, financing hydrogen, renewable energy, water security and food systems.

“Malaysia will also lead in technology-driven Islamic finance -- from Islamic digital banks to artificial intelligence-enabled Shariah advisory and blockchain-based sukuk platforms.

“We will modernise social finance -- digitising zakat, developing productive waqf, scaling micro-takaful and strengthening community resilience,” he said during the opening of the 20th Kuala Lumpur Islamic Finance Forum (KLIFF) 2025 today. 

According to Fadillah, with the world’s first tokenised cash waqf sukuk, Malaysia showcased that Islamic finance can be compassionate, innovative and inclusive.

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“We lead in green finance through the Sustainable and Responsible Investment (SRI) Sukuk and Bond Grant Scheme, covering 100 per cent of eligible costs and aligned with the ASEAN Taxonomy.

Additionally, the deputy prime minister emphasised that Islamic banking contributes 46.6 per cent of total national financing and is on track to surpass 50 per cent -- making Malaysia the first country in the world where Islamic finance becomes the mainstream system.

“Islamic banking assets exceed US$260 billion (US$1=RM4.14), and our Islamic capital market stands at RM2.63 trillion, representing 62 per cent of the total market.

“Malaysia also remains the world’s leading sukuk market, commanding between 40 per cent and 50 per cent of global issuances,” he added. 

Themed “Strengthening Economies, Advancing Resilience and Sustainability”, the two-day forum beginning today gathers more than 400 delegates from around the world to discuss the future of Islamic finance and investment opportunities.

KLIFF 2025 will feature discussions ranging from regulatory innovation to sustainable and digital Islamic finance, highlighting the government’s strong support for advancing Malaysia as a global leader in Islamic finance. 

-- BERNAMA