Brunei needs to develop its Islamic Fintech sector to ensure financial inclusion, as the sector can be a “game-changer” for individuals and MSMEs who do not qualify for financing from traditional Islamic financial institutions.
This was said by the Minister of Home Affairs, Yang Berhormat Pehin Orang Kaya Seri Kerna Dato Seri Setia Dr Hj Awang Abu Bakar Hj Apong in his keynote address during the Brunei Darussalam Islamic Capital Market Conference (BICAM 2021) on Wednesday.
Speaking in his capacity as the Deputy Chairman of Autoriti Monetari Brunei Darussalam (AMBD), the minister highlighted how FinTech or financial technology can help drive Islamic finance towards creating a greater impact.
“Even though Islamic Fintech is still in its infancy, Islamic financial institutions must continue to invest in technologies to transform the way they conduct their business,” YB Pehin Hj Abu Bakar explained.
He then called for the industry to challenge itself by adapting and collaborating with Fintech players, as both finance players and startups stand to benefit from such collaboration.
“Collaborative finance can build an omnipresent ecosystem as different players each have their own strengths, presence and customer base,” the minister added.
YB Pehin Hj Abu Bakar then highlighted how the development of Islamic Fintech is crucial in order to serve the need of MSME as Islamic Fintech platforms like crowdfunding can be a “game-changer” for individuals and MSMEs that do not qualify for financing from traditional Islamic financial institutions.
Currently, Jana Kapital, one of the Fintech operators in AMBD’s Fintech sandbox, is working on exploring the feasibility of an Islamic crowdfunding platform – a marketplace to match eligible startups and MSMEs requiring assets financing with investors looking to invest.
“I hope we will see more interest and activity in this space as there is large untapped potential here,” he said while noting the greater acceptance of Fintech by consumers especially during this age of social media and high technology.
COVID-19, in particular, the minister added, became a “wake-up call” for individuals to realise the importance of having an emergency fund in times of uncertainty.
Despite these great strides in consumer behaviour towards Fintech, the minister believed that a gap still exists that needs to be closed, noting how the delivery of financial solutions has not been able to keep up with consumer demands.
“The regulatory environment has been made favourable for Fintechs to operate while AMBD is currently considering to establish a Fintech Hub as a centralised platform for Islamic Fintech-related activities,” the minister went on to say.
“Collaboration and technology are keys in realising our targets and in ensuring economic growth is resilient, sustainable and inclusive,” added YB Pehin Hj Abu Bakar.
BICAM 2021 is held to support the Ministry of Primary Resources and Tourism’s (MPRT) Brunei Mid-Year Conference and Exhibition (MYCE) event, specifically in the first week of the month-long event, carrying the theme “Islamic Week”.
THE BRUNEIAN | BANDAR SERI BEGAWAN