Mustafa Adil
On 20 October 2026, LSEG and the Islamic Corporation for the Development of the Private Sector (ICD), the private-sector arm of the Islamic Development Bank (IsDB) Group, announced the findings of the 2026 Islamic Finance Development Report (IFDR) at the Kuala Lumpur Islamic Finance Forum (KLIFF) in Malaysia.
The 2026 edition of the IFDR presented several key findings
- The global Islamic finance industry maintained a strong growth trajectory in 2025, with total assets reaching US$6.5 trillion, up 9% year on year. Growth was supported by the continued expansion of Islamic banking, record sukuk issuance, strong Islamic fund performance and new regulatory frameworks.
- Malaysia, Saudi Arabia, the United Arab Emirates, Indonesia and Pakistan retained their positions as the world’s most developed Islamic finance markets. These countries continued to benefit from comprehensive regulation, strong institutional development, active financial markets and well-established knowledge ecosystems.
- Several markets recorded notable gains in performance, including Türkiye, Tanzania, Kenya, Benin, Azerbaijan, and Uzbekistan, highlighting the growing momentum across both established and emerging Islamic finance markets.
The report also identified several structural trends shaping the industry’s development. Regulatory reforms and stronger market infrastructure are supporting growth beyond core markets, particularly across Africa and Central Asia. Sustainability guidelines are receiving greater priority, although activity remains concentrated in developed markets. Digitalisation is also advancing, with fintech, open banking and tokenised sukuk influencing financing, issuance and settlement while widening access to financial products. However, talent development is not keeping pace with the industry’s expansion, highlighting the need for stronger specialist education.
For ICD, these developments reinforce the importance of ensuring that Islamic finance serves as a practical instrument for inclusive and sustainable economic transformation. ICD remains committed to advancing private-sector development across its member countries through targeted financing and the promotion of Islamic financial solutions.
Khalid Khalafalla
Looking ahead, global Islamic finance assets are projected to exceed US$10.5 trillion by 2030, supported by continued Islamic banking expansion, growing sukuk issuance momentum, emerging-market adoption and demand for sustainable and digital financial solutions.
Mustafa Adil
The report draws on the Islamic Finance Development Indicator (IFDI), a global benchmark that assesses the development of the Islamic finance industry across 140 countries in five key areas: financial performance, governance, sustainability, awareness and knowledge. It provides a holistic view of the global Islamic finance landscape, measuring progress in alignment with Islamic principles and helping stakeholders identify opportunities for growth and reform.
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