The Challenge of Islamic Capital Market

The challenge of Islamic Capital Market

First, lack of an international Islamic financial certification body. Certification is a significant achievement for determining the quality and performance improvement process of high quality learning and staff in the Islamic financial services industry. There is currently no similar institution to be able to fully address the certification standards for Islamic finance industry learning courses and to demonstrate that the relevant training courses can drive the skills needed for the development of the market. The documentation for staff training proves that certified courses are critical to regulatory firms. For example, Islamic finance should not be distinguished from economic systems and jurisdictions solely because of Islamic law.

Second, the Islamic financial market is in the early stages of development, less developed financial markets make Iraq Bank operations are less profitable than traditional banks. Less hedging instruments and techniques make Islamic banks more risky. Due to Islamic law, Prohibit interest, and some scholars on the "risk" and "uncertainty" (Gharar) explanation to the Islamic Bank. You cannot use hedge strategies and techniques such as options, futures and long term, and many other traditional banking hedging instruments.

Third, the shortage of Islamic financial talent constitutes an important constraint to further development. As the Muslim doctrine experts need long-term study, the lack of relevant personnel in the Islamic financial industry. Malaysia focused on the training of relevant personnel, the central bank set up the International Islamic Financial Education Center (INCEIF) and the Bank of Malaysia and Finance, but the talent training and consulting ability is far from meeting the demand.

Forth, the Islamic financial market lacks of language problem because of language barriers and the complexity of Islamic banking products. Different countries and even different inter-bank product structure differences, but also increased the cross-border expansion and background functions the difficulty of the package.

Fifth, the Islamic financial market lacks sustained competitiveness

As a result of the protection of the government, most of the operation of the Islamic banks is smooth, but with the globalization The depth of the Islamic business development potential and momentum to attract such as HSBC, UBS and other banking giant Head of attention. Islamic governments have relaxed the need to build the domestic market and support the development of the industry Constraints, mixed banks that provide both Islamic banking products and ordinary banking products. Began to enter the Islamic banking market, the original Islamic banking policy and monopoly advantage is being new to the market Of the competitors eroded. These competitors will meet the Islamic Shariah products with superb marketing tools and customers Service skills together, using a variety of strategies to find development opportunities. To keep in this new environment Competitiveness, the existing Islamic banks must adopt a variety of ways of doing business, such as determining the most valuable customers and provide them with high-quality differentiated services; improve operational efficiency, strengthen risk management.