Finance & Banking




Where there was once a huge technological gap between the wealthy and poor nations, we now observe the rapid adoption of technology in the lessdeveloped world. This is driven by the availability of low-cost smartphones, leading to the incredible explosion of mobile-data users. With this, the expensive internet infrastructure that had prevented the spread of the internet is suddenly no longer a barrier. Anyone can go online with a mobile phone, with the exception of some remote areas unreachable by mobile networks.

With millions of more people coming online, we have become a giant global village. Humanity now has in its
grasp the unique opportunity to exchange knowledge and ideas in a borderless environment. Connecting
people also means that we can now share our time, effort, money and other resources with others more easily.

The Sharing Economy and the Start of the Gigeconomy

E-commerce was the first off the blocks, with Amazon booming in the US and Alibaba in China. Soon, local
options emerged, and now ‘online shopping’ is so widespread that it has replaced physical buying. With advances in logistics infrastructure and technology, it is now viable for people to buy individual items from across the globe. Next, we will likely get used to drone-deliveries.

‘Gig-economy’ came next with people providing services to each other. The meteoric rise of Uber and Airbnb proved that the sharing economy could bring tremendous value to society by activating dormant or under-utilised vehicles and apartments for use by others. Complacency leading to poor quality among taxi companies and hotels pushed customers to these new options, and the ease of use of these technological solutions helped retain these customers. Would anyone choose to flag down a taxi today if you had a ride-hailing app? Why get a hotel room with outdated electronics and poor Wi-Fi when you can get an entire apartment with a smart TV at the same price, especially one recommended by other users?

A Shift to People-Power

The spread of international trade and investment
was known as globalisation. This was driven by
governments and large corporations. Ordinary
person had little say or influence in how things
panned out, resulting in increased inequality where
developing countries tend to be exploited in the
pursuit of profits. The sharing economy, however, is
fundamentally different – it gives the power back to the people. Today, although the unicorn tech
companies running the sharing economy platforms
are indeed powerful, they also understand that
the fuel for their platform is the users. The sharing
economy is essentially an ecosystem of marketplaces
that facilitate sharing of resources. These platforms
facilitate people-to-people or peer-to-peer delivery of

Sharing of Money – Crowdfunding

Does the sharing economy bring this people-power to finance? While much of fintech is focused on payment
technologies for faster and cheaper transactions, one fintech model stands out as a sharing economy platform for funds – crowdfunding!

Charity, financial support and various types of investment can be raised via online crowdfunding platforms. Today leading platforms are already channelling billions of dollars to hundreds of thousands of projects and campaigns online. China and the US have seen more than US$250 billion move through these platforms, mainly as direct lending or investment. The UK and Australia have introduced regulations, resulting in their crowdfunding industries sky-rocketing to hit tens of billions of dollars in just a few years. Ever since Indonesia started registering platforms in 2016, allowing them to operate within limits, crowdfunding has ballooned to more than US$1 billion!

Crowdfunding essentially connects those with funds to those who seek funds. The minimum is usually small amount, allowing for large-scale participation and virality. Larger investors can choose to spread out their investment into multiple campaigns at a time, while smaller investors are now empowered to increase their investment activities. Interestingly, while there is a large wave of first-time investors, most markets have also seen a surge of investments from high-net-worth individuals (HNWs), sophisticated investors and financial institutions. Everybody and anybody can now easily syndicate investment deals online.

The key value in crowdfunding is that it brings social
capital to the equation. This leads to greater visibility
of such platforms, attracting more quality projects for
fundraising, appealing to more funders and leading
to a virtuous cycle – a snowballing ‘network’ effect.
With so much deal flow coming to these platforms,
larger investors and institutions seeking deal flow and
returns start to participate, bringing their larger funds in.

The Islamic Digital Economy

How does all this bode for the Muslim world? Let’s
look at the numbers and facts. Islam is the fastestgrowing religion and is expected to be the largest
group in the next few decades (Pew research). The
Muslim world is young and has high mobile and
internet penetration rates. With close to two billion
Muslims, there is a huge population with unique
financial needs for halal investment and charity.

How fast Islamic crowdfunding will grow also
depends on how many Muslims will go for Islamic
alternatives as compared to conventional ones. While
there is definitely a significant pool of practising
Muslims who will only engage in halal activities,
there are also those who take Shari’a-compliance
less seriously. Islamic platforms must thus be able to
provide competitive services and quality experiences
to secure Muslims who may view Islamic as a feature
or a bonus. On the other hand, non-Muslims may
also participate, attracted to the universal ethics of
Islamic finance.

The sharing economy thrives when strong online
communities are formed. Muslims are arguably
the single largest group of people with unique
preferences – in short, the biggest community on
earth. When good Islamic crowdfunding platforms
are able to reach out and effectively serve this giant
community, the scale will be immense. And if the
experience is a good one, these Muslim users will be
converted into loyal advocates and supporters.


Edbiz Consulting and Cambridge IFA have been mandated to create public awareness on Islamic finance amongst
the masses in Pakistan, Afghanistan, Tajikistan, Kazakhstan and the Kyrgyz Republic under the Cambridge Islamic Banking Master, also known as Cambridge-IBM.

Cambridge-IBM, is part of the Islamic financial literacy agenda of Cambridge IFA. The current phase is being supported by the Asian Development Bank (ADB) and the Government of Japan

Cambridge-IBM is a quiz programme, developed by Cambridge IFA, that offers insights into Islamic financial concepts, products, institutions and markets, organised in a ‘Who Wants to Be a Millionaire?’ format. The session of Cambridge-IBM at the 3rd World Islamic Economic Finance Conference (WIEFC), hosted by Minhaj University Lahore (MUL) was attended by over 200 people and three contestants volunteered to participate.

Out of the three contestants (two men and a woman), Hadia Saqib Hashmi won the contest and became the first Pakistani Cambridge-IBM and the third from around the world. Congratulations to Hadia Saqib Hashmi for achieving this most prestigious recognition. MUL also deserves special appreciation for inculcating Islamic financial knowledge amongst its students.

Cambridge-IBM can be considered as a better tool for learning than a traditional workshop, as it offers instruction and training into Islamic banking and finance through entertainment – a phenomenon also known as infotainment or edutainment.

i.e., as an obligation owed by the buyer. If the contract fixes a term of payment, the seller cannot demand the price until then.

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