Fintech can boost Islamic finance penetration: Finance Ministry

05 July, 2018      405



Deputy Finance Minister Mardiasmo says the development of sharia financial technology (sharia fintech) has potential to help enhance the share of sharia financial businesses in the country’s financial services.

“To accelerate the process of strengthening the role of Islamic finance, we need to think out of the box, including by taking recent technological advancement into consideration,” said Mardiasmo during the third Annual Islamic Finance Conference in Makassar on Wednesday.

“I believe harnessing [sharia] fintech would have a positive impact on this issue.”

Financial Services Authority (OJK) deputy commissioner Sarjito said the authority had recorded that from 50 peer-to-peer (P2P) lenders registered with the authority, only one, Ammana, was a sharia-compliant firm.

Mardiasmo expressed the hope that the growth of sharia fintech would become the catalyst to increase the share of Islamic banks in the country’s financial services.

He added sharia fintech also had the potential to give more financing to small and medium enterprises (SMEs).

Mardiasmo, however, said people lacked knowledge on the matter.  “We need to deepen understanding of sharia knowledge among fintech players so that they can comply with sharia-based regulations,” he added. (bbn)

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