Islamic Securitization: A Revolution in the Banking Industry

For all the growth Islamic finance has witnessed in the past three decades, it has missed investment opportunities that offer a predictable return with low risk. The majority of the available investment opportunities are either based on stock markets with high volatility, or on real estate transactions. The introduction of Sukuk, also known as asset-backed securities, aided in addressing this gap. Recently, investors' interest in Sukuk has been growing exponentially, and the demand for these instruments will continue to surge. The total global market of Sukuk, either issued or in the pipeline, is around US$15 billion, and at the current rate is expected to multiply into tens of billions of dollars in the upcoming years.