Market Study of 

Islamic Banking in GCC and Egypt

Research objectives
• A study on cash management and trade finance in Islamic banking in the GCC and Egypt.
• Conducting a comparison of different Islamic products.
• Implementation of Fintech in Islamic banking.

RESEARCH METHODOLGY:

Both qualitative and quantitative approaches were adopted.

The research is descriptive as well as diagnostic in nature
When it comes to secondary data, we have used various articles and websites.
And when it comes to primary data, we have done surveys using google forms and
conducted expert interviews.

Islamic Banking: Islamic banking, Islamic finance, or Sharia-compliant finance are all terms
for financial services or banking which abide by Sharia as well as its implementation through
the growth of Islamic finance.

The core of Islamic banking and finance is the idea of credit risk.

According to Islamic law, financing with interest expenses is viewed as a connection that
benefits the banker, who collects interest expenses from the debtor.

Advantages of Islamic Banking:

 Greater transparency
 Non-compounding of late payment charges
 Clarity on maximum amount payable
 Upfront profit for Islamic fixed-term deposit

Trade Finance:
The goal of trade finance is to reduce demand & financial risks from deals by bringing in a
foreign entity.

There are several stakeholders who participate in trade financing, which may include:
 Financial institutions
 Financing firms
 Both manufacturers & consumers
 Insurance providers
 Businesses & telecommunications companies for financing facility
Cash Management:
The daily management of managing cash inflows and outflows is referred to as cash
management in a banking institution. It is necessary to manage the numerous monetary
transactions that occur every day. The main objectives of cash management are to increase
liquidity and decrease funding costs.

KEY TRENDS:
 With 69%, or USD 1.992 trillion, of the assets in the business, Islamic banking is the
biggest sector in the whole Islamic finance market
 The primary driver of the sector's expansion is still commercial banking .
 Dubai Islamic bank has successfully closed a US$1 billion Sukuk issuance in June
2020 that was actually planned as a US$750 million issue during the initial quarter but
was postponed because to unfavourable market conditions brought on by the
pandemic.

FINTECH STRATEGIES OF ISLAMIC BANKS;

Modern definitions of digital transformation include using cutting-edge technology to boost

business performance and efficiency.

Fintech improves consumer experience while increasing competition in open banking, data
analytics, and digital banking services.

RECOMMENDATIONS:

Particular attention must be paid to two areas in order to successfully compete with
traditional banks:

To begin with, Islamic banks should investigate using alternate channels to capture market
share, such as phone and internet banking.

In addition, several branch formats should be investigated, varying from light, self- service
sales outlets that target retail mass shoppers to full-service branches that serve all customer
groups, depending on the demands of the target segments.

Islamic banks will be better positioned to seize untapped market possibilities and control the
shifting dynamics of their business if they invest the time now to think through strategic
options and address operational problems.