Islamic banking has evolved from a niche offering to a mainstream
financial segment, spanning more than 80 countries and assets exceeding USD 5
trillion. Yet, ambiguities around what it is \u2013 its principles, structures, and market
dynamics \u2013 pose challenges for corporate leaders seeking to engage with or invest in
this space, with 65 per cent of corporates indicating interest in Shariah-compliant
solutions had no prior background, or exposure to Islamic banking.
\u2018Islamic Banking for Corporates: Broadening Horizons\u2019, a report by Standard Chartered
published today, identifies a lack of product familiarity as a key factor restricting
corporates from accessing USD 5.5 trillion in global Islamic finance assets, which is
projected to reach USD 7.5 trillion by 2028. The number of corporate Sukuk issuers has
nearly doubled since 2020, driving a 38 per cent increase in issuance volumes to USD
58.8 billion in 2024.
\u201cIslamic banking has evolved into one of the world\u2019s fastest-growing sources of capital,
but awareness amongst corporates has not kept pace,\u201d said Khurram Hilal, CEO of
Group Islamic Banking at Standard Chartered. \u201cCorporates that build Islamic finance
capabilities stand to access specialised capital pools with trillions in assets, preferential
pricing in oversubscribed markets, government incentives in high-growth markets, and
ESG-focused capital pools where ethical screening is structurally embedded. This
knowledge gap reflects an increasingly expensive opportunity cost.\u201d
Sustainability and AI driving momentum
Islamic finance principles align closely with ESG frameworks, both prioritising
transparency, fairness, ethical conduct and environmental responsibility. Sustainable
Sukuk were oversubscribed by an average of 4.3 times their issuance value in 2024,
compared to 3.1 times for regular Sukuk, reflecting heightened investor demand for
instruments that meet both Shariah and sustainability criteria.
Digital innovation is further accelerating this momentum. Tokenised Sukuk, blockchain-
based settlements, and AI-enabled Shariah-compliance tools are set to transform how<\/p>\n\n\n\n
capital is raised and managed, while reducing issuance costs and improving cross-
border governance.
Gateway to high-growth emerging markets
Islamic banking provides strategic access to critical trade corridors and economies
where Shariah-compliant finance is increasingly expected or mandated, particularly
across the GCC, Southeast Asia, South Asia, and Africa. Shariah-compliant finance
underpins much of the USD 5.7 trillion South-South Corridor connecting these regions,
which now accounts for nearly a quarter of global trade. This has become increasingly
relevant amid shifting trade and investment corridors.
The Halal economy alone represents a USD 2.2 trillion market opportunity. Corporates
operating across Muslim-majority markets are increasingly leveraging Islamic trade
finance and supply chain solutions through initiatives such as Standard Chartered
Saadiq\u2019s Halal360, and the expanding Islamic trade finance networks.
Standard Chartered is the only international bank with a global Islamic banking
franchise, serving clients across more than 30 markets through Standard Chartered
Saadiq. The bank has arranged over USD 200 billion in Islamic financing, spanning
Sukuk, structured trade and sustainable-finance solutions.
\u201cIslamic finance is now a strategic conversation in boardrooms,\u201d Khurram Hilal added.
\u201cOur role is to bridge interest with expertise, helping global corporates deploy practical
and cross-border Shariah-compliant banking solutions that support their business
strategies.\u201d<\/p>\n\n\n\n
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