KUALA LUMPUR, July 27 — Bank Negara Malaysia (BNM) and the Securities Commission (SC) have been taking steps to ensure the sustainability and effectiveness of the Islamic finance system by raising the standards to not only halal, but also ‘halalan thoyyiban’ (lawful and good).

Prime Minister Datuk Seri Anwar Ibrahim said BNM and the SC have charted the course towards halalan thoyyiban via the Malaysia International Islamic Financial Centre through collaborations with the industry and the Islamic finance ecosystem, including zakat and waqf boards, the banking system, Islamic stock market and sukuk.

This is done by focusing on equity financing, including venture capital, equity crowdfunding and the Islamic digital economy, Islamic social finance (including zakat, waqf and sadaqah), as well as the ‘blended finance’ methods that use funds from a wider range of sources.

"Insya-Allah (God willing), these efforts will help to enhance the Islamic financial system in Malaysia and further strengthen our position as a leader in the global Islamic economy," he said at the launch of the Madani Economy: Empowering the People, here, today.

He added that this would also help to boost the growth of environmental, social and corporate governance (ESG) funds globally.

"A holistic and Madani national development effort cannot be achieved without a financial system that is fair, just and based on Maqasid Sharia (the objectives and purposes behind Islamic rulings),” he said.

The prime minister said that Malaysia has a holistic Islamic finance ecosystem, adding that after the establishment of Bank Islam 40 years ago and Lembaga Tabung Haji 60 years ago, Malaysia’s Islamic finance system has been recognised as the world’s best by independent analysts.

"Today, the Islamic banking’s share of the financing market is at 44.5 per cent (RM974.1 billion), and the Islamic capital market remains the main component of the Malaysian capital market, accounting for 64.3 per cent (RM2.32 trillion),” he added. — Bernama