Banks and governments across the globe are working to reform regulatory environments and establish measures to facilitate compliant access to Islamic Finance. Malaysia’s largest bank Maybank recently indicated that it provided more Islamic loans than non-Shariah compliant financing for the first time in 2015. And the Bank of England is currently seeking advice on four proposed models which could facilitate Shari'ah compliant deposit services and position the UK as a global centre for Islamic finance.
Kenya is one African nation also undergoing reforms to facilitate access to Islamic finance. The east African nation’s Attorney General Githu Muigai recently confirmed that the Kenyan government will review current regulations, to facilitate the issuance of its first ever Islamic-law compliant bond in the 2016/17 fiscal year.
Mona Doshi, a lawyer with Kenyan firm Anjarwalla and Khanna, and an Islamic finance expert, highlighted the need for reform saying “Regulators in east Africa have recognized that they need to make legislative changes to allow Islamic finance to flourish as the current legal framework isn’t conducive.”
Though Kenya already boasts two Shariah-compliant banks, Doshi highlights that despite adjustments being made to accommodate the special nature of Islamic banks at present their “basic framework is the same as for conventional banks.”
Existing regulations don’t currently cater to the complexity of the Islamic finance, which under Shari’ah law considers investment and direct payments usury. These revisions are likely to increase investments and trade flows for the Middle East which has the potential to support funding gaps across East Asia.
So with reforms imminent in both Kenya and across the globe the demand for legal professionals with knowledge of the Islamic finance industry is likely to rise dramatically. Even once the initial revisions are completed, the global market will undoubtedly require continued legal support and guidance. This could potentially pose lucrative opportunities for legal professionals with the specialist skills required to navigate a complex financial regulatory market.