Deputy PM Fadillah outlines Malaysia’s ambition to be a global leader in Islamic fintech, climate sukuk, and ESG standards by 2040.
KUALA LUMPUR: Malaysia aims to become the global benchmark for Islamic finance regulation, innovation, and environmental, social and governance standards by 2040.
Deputy Prime Minister Datuk Seri Fadillah Yusof said the country also aspires to be a centre of excellence for Islamic fintech and climate-oriented sukuk.
He stated that the global financial landscape is evolving with Islamic finance poised to lead a new frontier.
“Malaysia’s direction is aligned with global megatrends,” Fadillah said during his opening address at the 20th Kuala Lumpur Islamic Finance Forum today.
He noted that Islamic finance will underpin Malaysia’s climate architecture, enabling transition, green and blue sukuk.
This financing will support hydrogen development, renewable energy, water security and food systems.
Malaysia will also lead in technology-driven Islamic finance from digital banks to AI-enabled Shariah advisory.
The country will modernise social finance by digitising zakat and developing productive waqf.
“We will scale micro-takaful and strengthen community resilience,” Fadillah added.
He highlighted Malaysia’s world-first tokenised cash waqf sukuk as evidence of compassionate, innovative finance.
The country leads in green finance through its Sustainable and Responsible Investment Sukuk and Bond Grant Scheme.
This scheme covers 100% of eligible costs and aligns with the ASEAN Taxonomy.
Islamic banking currently contributes 46.6% of total national financing in Malaysia.
Fadillah said it is on track to surpass 50%, making Malaysia the first country where Islamic finance becomes mainstream.
Islamic banking assets exceed US$260 billion while the Islamic capital market stands at RM2.63 trillion.
This represents 62% of Malaysia’s total capital market.
The country remains the world’s leading sukuk market with 40% to 50% of global issuances.
The two-day KLIFF 2025 forum gathers over 400 delegates to discuss Islamic finance’s future.
Discussions will cover regulatory innovation and sustainable digital Islamic finance.
The event highlights strong government support for advancing Malaysia’s global leadership in Islamic finance. – Bernama
