Islamic Finance Joins IMF

Religious system bans interest payments, pure monetary speculation

Image Credits: Chung Sung-Jun / Getty.

The International Monetary Fund will incorporate Islamic finance into its financial sector assessments of select countries starting next year, aiming to improve regulation in the growing sector.

The IMF has traditionally focused on conventional banking, but it has been increasingly engaging with regulators in countries where Islamic finance is now deemed to be systemically important.

Under a proposal by the IMF’s executive board, guidance issued by the Malaysia-based Islamic Financial Services Board (IFSB) would be incorporated into IMF assessments to address the regulation and supervision of Islamic banks.

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