Islamic finance is an emerging industry globally, attracting the attention of non-Muslims and non-Muslim countries as a potential substitute for conventional financing. It has dual attraction for customers and depositors. First, it provides Sharia-compliant financial solutions to both customers and depositors. Second, it ensures at least as much material benefits as provided by conventional financial institutions. Moreover; assets-based financing, sharing profit and genuine losses, resilience, proven resistance to financial shocks and supporting financial stability are universally acknowledged features of the industry.
The top 20 countries where Islamic financial products and services are growing include non-Muslim countries like the United Kingdom, Switzerland, and Thailand. The UK is working hard to establish London as a hub of Islamic banking to rival Dubai. The interest non-Muslim countries are taking in Islamic financial products and services reflects the suitability, profitability and reliability of the Islamic financial industry to meet complex financial requirements of modern world’s customers and depositors.
In Pakistan, the industry is growing at an impressive rate. In 2018, the Islamic banking industry assets reached 12.9 per cent of the banking sector. The deposits accounted for 14.8 per cent of the total banking industry deposits (as reported by the State Bank of Pakistan in January 2019). The central bank has played an important role in facilitating the progress through regulatory and enabling environment for Islamic banks and investment companies.
The UK is working hard to establish London as a hub of Islamic banking after Dubai
The growth of the Islamic financial industry is causing a mismatch between required and available human resources at different levels and for different institutions. At the same time, it provides an opportunity to academic institutions to design and develop Islamic business programmes to meet the requirements of the Islamic finance industry.
Islamic finance education can ensure a promising career because exponential expansion of the Islamic finance industry in Pakistan has created a severe shortfall of trained human capital. This gap is usually filled by trained staff from conventional financial industry. However; the lack of basic Sharia and Islamic finance knowledge among the conventional financial institutions’ staff is causing misconceptions about Islamic financial products and services among the customers. The Islamic banking and finance field is growing at a much faster pace than the education institutions are able to produce graduates with required training. According to a conservative judgment around 4,000 Islamic finance graduates are required, each year, to meet the requirements of human resource of the Islamic finance industry in Pakistan.
In order to facilitate and provide quality graduates and skilled staff to the industry, and promote Islamic finance education and research, the State Bank of Pakistan has established three centres for excellence in Islamic finance in reputed business schools of the country. These centres are located at the Institute of Management Sciences (IMSciences) Peshawar, at IBA-Karachi and at LUMS. These centres are providing quality Islamic finance education, training for professionals and awareness about Islamic banking and finance.
Based on the judgment of the officials of State bank of Pakistan, Centre for Excellence in Islamic Finance IMSciences is leading in terms having highly reputed Islamic finance faculty, knowledge creation in the form of writing textbooks and producing local cases in Islamic finance and PhD programme initiation in Islamic business and finance.
IMSciences has conducted many international training across UK, Indonesia, Rwanda and Zambia to contribute and accelerate the journey of Islamic finance at global landscape.
The writer teaches economics at the Institute of Management Sciences, Peshawar