Opening Remarks at The FIKRAtech Roundtable

Speaker: Dato’ Mohammad Faiz Azmi, Chairman, Securities Commission Malaysia

Location: London
Delivered: 4 September 2024

Key Highlights:

In his opening remarks, SC Chairman, Dato’ Mohammad Faiz Azmi urged stakeholders to collaborate and lay the groundwork for the future of Islamic fintech. He also hoped that the outcomes from the Rountable will help propel fintech startups in Malaysia and the UK, onto the broader markets.

Here are highlights from his opening remarks:

Fintech enables Islamic finance to promote social justice and ethical conduct, increasing fintech’s potential for social impact.
The industry needs to rethink its branding approach such as looking at the maqasid al-Shariah aspirations and principles and to focus more on the ethical values that resonate with broader audience.
Although Islamic solution providers are still a small part of the ecosystem comprising 8 out of 25 ECF/P2P players, their presence is still growing.
In Malaysia, ECF and P2P platforms have been raising significant sums for Shariah-compliant projects — more than US$262 million (RM1.24 billion) over the past 7 years.
The numbers have grown exponentially from 2022 to 2023; Islamic ECF/P2P solutions in Malaysia currently contributes at least 24% of total alternative funding, compared to only 8% in 2022.
The UK is not only known for producing fintech unicorns, but has a strong Islamic fintech ecosystem, with 43 active Islamic fintech players as of December 2023.

Full Speech:

Distinguished guests,
Ladies and Gentlemen.
Assalamualaikum and a very good morning,

A warm welcome to all of you. It is wonderful to see everyone gathered here at The Dilly for the second Fintech Roundtable. I trust you have all had a chance to grab coffee and settle in.
A heartfelt thanks to our partners, the Malaysia Digital Economy Corporation (MDEC) and Islamic Finance News (IFN). Your ongoing support is what makes events like this possible. I am delighted to see such strong representation from both UK startups and Malaysian startups, who are fintech innovators, industry movers, and game changers redefining the financial landscape.
The theme for this year’s Roundtable, ‘Innovating the Future of Islamic Finance’, is apt. Islamic finance’s inherent orientation towards economic and social justice, shared prosperity, and inclusive participation makes it suitable to take the lead in transforming economies for a greater purpose. Fintech is a powerful enabler in this endeavour.

Global Trends and the Future of Islamic Fintech
As we look ahead, it is impossible to ignore the global trends that are shaping the future of fintech and Islamic finance. Technologies like blockchain, artificial intelligence, and decentralised finance are no longer just theoretical concepts, they are transforming how we think about finance.
One interesting aspect of fintech would be its potential for social impact. Islamic finance, at its core, is about promoting social justice and ethical conduct. Fintech is enabling us to do just that.
This is also consistent with one of our main conclusions during the Fintech Roundtable last year; tech-enabled Islamic finance solutions hold the potential to address various social issues, in relation to access, transparency and impact.
However, reflecting on our collective discussions last year, we agreed that Islamic fintech remains underutilised due to many challenges. These challenges include restrictive regulations for startups to scale up, the lack of capital available for Islamic fintech startups and the ‘perception’ on the Islamic identity that may be working against us.
On a brighter note, some of the recommendations from last year’s roundtable are already in the works. Among others, on the lack of capital, we are increasing the promotion and nurturing of VC–accelerators backed by industry bodies.
In relation to the concern with the Islamic identity, one of the recommendations in 2023 was to rethink our identity. The industry needs to rethink its branding approach. One way perhaps is to look at the Maqasid al-Shariah aspirations and principles and to focus more on the ethical values that resonate with broader audience. This shift we believe would allow Islamic finance to appeal to a wider demographic without compromising its core values.

SC’s Commitment to Advancing Islamic Fintech
At the Securities Commission Malaysia, we continue to play a role in fostering an environment where innovation can be encouraged, enabling entrepreneurs to secure market-based financing for start-ups and early-stage companies. Since 2015, we have gradually introduced several initiatives.
This includes our Guidelines on Recognised Markets, platforms for industry discussions such as Fintech Roundtables and dialogues with key industry players, and a regulator-led accelerator programme, FIKRA ACE, which promotes Shariah-compliant solutions. We have also introduced licensing for fintech players for example Recognized Market Operators (RMOs), Digital Asset Exchanges (DAX), and Digital Investment Management Services (DIMS). The goal has always been to strike a balance, to give new players the confidence to enter the market, and to provide a clear path that fosters growth while keeping everything on track.
We were the first in the ASEAN region to introduce a framework for equity crowdfunding (ECF) in 2015, starting with just six players. Since then, we have expanded significantly, and today, we have over 40 players across various fintech verticals, including peer-to-peer financing (P2P financing), digital asset exchanges, and initial exchange offering platforms.
Although Islamic solution providers are still a small part of this ecosystem (8 out of 25 ECF/P2P players), their presence is definitely growing. Our aim is to cultivate a robust digital landscape by offering a balanced regulatory framework that supports innovation while maintaining market integrity.
We can see that these efforts are paying off. In Malaysia, our ECF and P2P platforms have been raising significant sums for Shariah-compliant projects — more than US$262 million (RM1.24 billion) over the past 7 years. The numbers have grown exponentially from 2022 to 2023; Islamic ECF/P2P solutions in Malaysia currently contributes at least 24% of total alternative funding, compared to only 8% in 2022. Overall, (Islamic and non-Islamic) ECF and P2P have raised around US$1.7 billion (RM 8 billion), supporting over 18,000 MSMEs, since inception.
Similarly in the UK, regulatory and industry efforts, have clearly paved way for the dynamic fintech landscape. To put this into perspective, as of the first half of 2024, the UK fintech sector has collectively recorded investments of US$2 billion across 184 deals. The UK is not only known for producing fintech unicorns, but has a strong Islamic fintech ecosystem, with 43 active Islamic fintech players as of December 2023. This makes the UK one of the top jurisdictions globally in Islamic fintech, ranking 5th behind Malaysia, Saudi Arabia, Indonesia, and the UAE.
The fintech sector in the UK is dominated by alternative finance, followed by deposits and lending, reflecting the alignment of fintech solutions with the core needs of the Islamic capital market.
But today’s Roundtable is not just about national success stories — it is also about cross-border collaboration. The fintech ecosystem in both our countries are ripe for partnerships that can lead to new, innovative solutions with global reach.
This Year’s Roundtable Format
This year, we have made some changes to the format of our roundtable to better address the challenges identified last year. One of the key issues we recognised was the need to broaden access to capital for Islamic fintech start-ups. Last year, we discussed the difficulties these start-ups face in securing funding, particularly those focusing on social impact, as they often struggle to attract investors who are willing to compromise returns for social good.
In response, this year’s roundtable features not only a morning session dedicated to discussion and collaboration, but also features an afternoon session designed to serve as a demonstration of what is possible. This new format is designed to provide a direct platform for fintech companies from the UK and Malaysia to share their ideas in front of a panel of judges from venture capital investors, and industry experts (from both Malaysia and UK/global). The aim is to connect these innovative start-ups with potential investors, helping them to secure the capital they need to scale up and make a greater impact, aligning with our broader goal of fostering innovation and supporting the growth of the Islamic fintech ecosystem.

Closing: Aspirations for the Roundtable
Ladies and Gentlemen,
Today is not just about exchanging ideas — it is about laying the groundwork for the future of Islamic fintech. Thus, our focus this year is on turning conversations into actionable outcomes.
I hope the conversations during today’s Roundtable will help propel our fintech startups, both in Malaysia and the UK, onto the broader markets. We have an incredible opportunity to connect our ecosystems, to work together, and to create solutions that will shape the Islamic capital market landscape for years to come.
On that note, once again my deepest appreciation and gratitude to our partners, MDEC and IFN and all the attendees here today.
Let us make the most of this opportunity. Share your ideas, challenge each other, and think big. I look forward to the inspiring work we will accomplish together today.
Thank you, and I wish all of you productive and fruitful sessions ahead.