Labuan IBFC develops shariah-based digital hub
Labuan IBFC aims to become a “digital gateway” while facilitating Shariah-compliant finance capabilities for global investors, according to the Labuan Financial Services Authority director general.
Announcing that the jurisdiction is now home to 85 digital license holders, Nik Mohamed Din Nik Musa said the regulator provided an innovative licensing regime to allow digital financial services (DFS) firms to operate in a live market environment.
“The DFS in Labuan IBFC is continually growing in recognition of the progressive approach that the centre has taken in embracing the digital revolution, by being as facilitative as possible to enable innovative digital business to take root in Labuan IBFC,” he said during his Welcome Address at the third Connecting Digital Ecosystems Asia, being held virtually on Thursday.
“Labuan IBFC is envisioned to become a digital-based gateway with Islamic finance capabilities for all global investors and players as the future of Islamic finance looks ever promising. The digital transformation in Islamic finance positively contributes to the evolution and innovation of Islamic financial products and services in a rapid tone.
He added: “As digitisation for the financial sector evolves, regulatory bodies globally will be posed with the balancing act of determining appropriate ways of regulating these changes vis-a-vis promoting market breakthrough and innovations. Ensuring stability will remain of paramount importance as financial transactions become more seamless, intangible and borderless. Therefore, Labuan FSA is committed to adopting a facilitative approach by developing fit-for-purpose requirements to cater for emerging business technologies,” said Nik Mohamed Din.
Farah Jaafar, CEO of Labuan IBFC Inc, said: “Being home to one of the fastest-growing digital families in Asia, our ethos of constant engagement with industry coupled with innovation and facilitation, puts us in good stead to embrace the next digital evolution, governed by sound regulatory parameters. This curates a regulated digital ecosystem, providing synergy between wholesale financial intermediation and digitalisation, allowing our licensees to operate in a facilitative borderless environment.”
Celebrating its 30th anniversary in 2020, Labuan IBFC is home to more than 5,000 active entities, including 232 insurance and insurance-related businesses.