FNB looks to digitise Islamic banking in SA

Islamic banking in South Africa has seen significant growth over the last few years, with FNB Islamic Banking South Africa celebrating its 15th anniversary this year. The conversation around Islamic banking has become more prominent recently due to various macro factors, including government support. In 2010, there were talks at the governmental level to introduce Islamic banking into the formal sector, leading to the revision of tax laws to accommodate Islamic banking products. This move aimed to level the playing field between conventional and Islamic banking and treat them equally in terms of taxation. Furthermore, in 2014, South Africa issued a $500 million sovereign Sukuk, attracting foreign investment and showcasing the use of Islamic financial structures for infrastructure projects in the country. Islamic banking has the potential to play a significant role in funding infrastructure development, including addressing challenges faced by state-owned entities like Eskom. The Islamic Development Bank has also shown interest in investing in African infrastructure projects, presenting opportunities for Islamic banks in South Africa. One of the key challenges for Islamic banking has been its integration into the digital economy. However, FNB Islamic Banking South Africa is leading the way in digitizing its products to meet the demands of its tech-savvy customers. The bank is innovating its offerings and bringing them online and on mobile apps to provide a seamless digital banking experience. When it comes to the products offered by Islamic banks, there is no discrimination based on faith. The products are developed to comply with Islamic principles but are available to customers of all backgrounds. Additionally, Islamic banks like FNB Islamic Banking South Africa have revenue targets and growth goals to ensure their financial sustainability and contribution to the overall banking sector. In conclusion, Islamic banking in South Africa is on a growth trajectory, supported by government initiatives and a growing demand for ethical financial products. FNB Islamic Banking South Africa's commitment to innovation and digital transformation positions it as a leader in the industry, catering to a diverse range of customers while upholding Islamic banking principles.