The global marketplace for commodities, goods, services, and information has expanded significantly. From the coast of Maryland to China, enormous economic, financial, and investment opportunities have emerged. These opportunities are driven by efforts to make ethically correct and socially responsible choices. In finance, Islamic banking and finance have positioned themselves as practical tools at the disposal of investors, financial institutions, and companies. Islamic banking and finance embody values, principles, and systems, making it the banking system of choice among millions of practitioners operating in more than 60 countries around the world. The value proposition of Islamic banking and finance embodies a growing outlook from the Middle East to the Far East and from Europe to America.
For exceptionally brilliant and ambitious students, a 5-year Integrated B.A. (Hons) Programme in Islamic Banking and Finance has been introduced, effective from the academic session 2019-20 in the Faculty of Social Sciences, Haj and Management. The degree course is meticulously designed to enable graduates to work in the Islamic finance industry across a range of roles, including compliance and support, business development, risk management, relationship management, product analysis, and development. In short, it will equip graduates with Islamic banking and finance domain knowledge, hands-on experience, and leadership skills to meet the Islamic finance market needs. The Joint Academic Programme in Islamic Banking and Finance not only prepares students for exciting and rewarding careers. The core purpose of developing this essay is to enable students and practitioners to understand the wider value proposition of Islamic banking and finance. It is remarkably important for stakeholders to have in-depth knowledge about the unique characteristics and operational mechanisms of Islamic finance. This paper highlights some issues regarding career opportunities in the field of Islamic banking and finance.
Understanding Islamic Banking and Finance
The Islamic financial system is grounded in the two teachings of Islam. The main categories of Islamic finance products, instruments, and services are fundamentally different from and diametrically opposite to the kinds of financial products, instruments, and services marketed and offered by Western commercial or online banks and financial institutions. Sharia prohibits the imposition of interest and the acceptance of compensation for the use of money. Sharia lays down several underlying principles in the light of the Qur’an, which financially deal with the management, supervision, and control of the funds of society. The following are the main underlying principles: prohibition of riba, risk and reward, individual responsibility, zakat, tawakul, transparency, and accountability. In Islamic financing and investment, trillions of dollars are tied up, and Islamic banks need hundreds of billions of funds.
The conceptual framework of Islamic banking and finance is built from a number of Islamic financial instruments that are applied in different combinations and processes to originate, invest, manage, and distribute Islamic savings among the surplus units that need financial funds and the deficit units that do not have enough financial funds for various investments in the fields of business, trading, industry, agriculture, etc. The basic Islamic principles of finance are mirrored by a number of Islamic financing and investment principles that have a major impact on all concerns of ethicality and social responsibility. Poor individuals have the right, during periods of prosperity and fortune, to receive capital in order to obtain power and become part of the wealthy in society. Islamic banks have the impact of supporting economic development, and their contribution may also be seen in declining global poverty rates.
Key Principles and Concepts
The most transformative and distinct principles that inspire and govern Islamic banking and finance are: justice, fairness, equity, and balance; accountability and shared social responsibility between financial institutions and investors; trust and confidence; transparency; and ethical investments meant not to harm and violate the rights of others. The most fundamental difference between Islamic finance and conventional interest-based banking lies in the application of the justice ethic underlying financial transactions. Due to the absence of risk-sharing in interest-based contracts, the creditor receives his pledged reward whether or not the day will be bright or cloudy for the debtor and the larger community.
Four other key concepts of Islamic financing are gharar prohibition, trading and profit-sharing, partnership financing, and commodities and assets being financed. The selling of debt, debt on debt, and uncertainty (and hence speculation) are prohibited. For a sale to be valid, the commodity must exist and be in the ownership of the seller at the time the sale contract is concluded. One’s reward is only for the value of work and effort, and only passive wealth creation without significant risk is unethical usury, thus bringing in the importance of trade for sound investment in sale models of financing. Commodities or assets must form the material substance of any agreement, and any surplus-based approach to finance and investment in financial credit products will involve business and contractual risk for the financiers. Islamic financing, as a commitment to and yet sharing in enterprise building, can provide the means to reduce the negative consequences of some impacts of the economic doctrines of shareholder capitalism and managerialism. Privatization, globalization, and deregulation have changed the manner by which business is conducted and are endangering the interests of stakeholders. The other rule that must be applied in Islam is that all the transactions of any banks must be according to Shariah.
Career Opportunities in Islamic Banking and Finance
This manual focuses on the Islamic banking and finance part. But before deciding what professional role you would like to take in this Islamic finance environment, it is advisable to have a basic understanding of this industry. The conceptual part helps in understanding how this business works at a global level.
Islamic financial institutions are operating in more than 60 countries globally. The total number of Islamic banks is the largest among them. Besides, there are non-bank sector Islamic financial institutions like takaful and sukuk. Therefore, all these banks and companies require skilled manpower to operate or administer. In the field of Islamic/commercial banks, newcomers have more opportunities at the ground level; they can join the banks as branch operation managers, marketing managers, finance managers, credit risk managers, fund managers, and marketing officers.
Working in the Islamic banking industry is an equally important task, as it requires leadership, managing other managers, and working through managers and beyond. Most of the multinational Islamic banks are operating in larger cities, and in most cases, they are looking for globally standard managers. Islamic banking regulatory firms are looking for operational heads, senior solution operation officers, senior finance officers, and senior compliance officers. Why? The reason is that these are specialized areas and require people who have Sharīʻah compliance qualifications and experience. Islamic financial advisory firms usually work in the largest cities where high-net-worth individuals reside.
Educational Pathways and Skill Development
To work in the fields of Islamic banking and finance, there is no formal educational requirement. The financial industry is looking for knowledgeable and passionate people who are dedicated to their work and interested in learning more about the industry. However, there are a variety of programs and certificates available for those who are interested in complementing their skills. There are a number of different academic pathways with which students can begin the process of preparing for a position in Islamic banking and finance. Most graduates will need at least a bachelor’s degree in finance, banking, management, economics, or Islamic studies. Suggested undergraduate classes include courses in money and banking, Islamic history, law and society, and management. This is the time for students who are interested in working in this sector to complete relevant field experiences. Once a bachelor’s degree is completed, students are encouraged to pursue graduate degrees in finance, management, law, and Islamic banking. Some programs offer certificates in Shariah-Compliant Finance and Business. These programs provide students with an overview of this sector, a history of current trends, ethics, principles, fund management, Islamic finance, and risk. Students interested in working in this industry should consider completing internships. These experiences are designed to help students acquire key skills and technical competencies and determine whether companies and law firms might want to hire them upon completion of their internship.
Professional Development and Networking
Continuous professional education and professional development are gateways and means for you to build on your skills. In a career such as Islamic banking and finance, which many fundamentally believe is a form of “worship” due to the related “halal” and riba-free (interest-free) practices, it is also an “ibadah” (worship); thus, doing and understanding it well is very important. Also, pursuing a career may be guided by some kind of personal passion or interest one has to build on because they are not only interested in earning a living but also in being of significance in society. Progress in your career can be made by joining industry associations where you can have access to information about developments in the market and a chance to meet with industry leaders. It enhances your profile in the market as a revered professional.
There are several advanced and professional certifications that one can pursue in this field; these include Islamic banking and finance, wealth and asset management, and Islamic capital markets. Sitting for exams will expose you to issues in the industry, and you will get case studies. Joining international networks and associations are all interests and additional career advantages. Study for and excel in the “halal” Business Muslim Network (HMN) certification, a portfolio that qualifies and certifies professionals to lead in the halal sector within their current profession. There are other forms of networks one can join, including community groups for support and spiritual growth. Other networks are based on educational institutions, sororities, fraternities, ex-school associations, hometown associations, and clubs centered on various social and recreational interests that exist in the market. Hard-to-get information can be found in networks, and you can gain access to politicians, tycoons, spiritual leaders, veterans, secret deals, etc., from people you network with. Building on your professional library, which includes books, DVDs, CDs, industry-related films and music, newspapers, trade journals, competitors’ materials, entrance exams, technical manuals, industry reports, mapping, and globalization information, is advisable. I recommend reading no more than three newspapers every day. You do not need to read cover to cover; concentrate on the headlines and topics of interest, especially business, editorial, and obituaries. Attend conferences, workshops, seminars, public speaking events, business mixers, exhibitions, trade shows, and participate in school alumni events, especially if you are pursuing an international career or are a non-Gambian. Identify areas of personal or professional interest, opportunities that exist in a particular country or industry, and attend those events. If in Gambia, attend events at local venues as you will identify.
Challenges and Future Trends
The Islamic banking and finance sector faces a few challenges, such as restrictions in accordance with local regulations, market players dominating the industry who are owned wholly by non-Muslims, individual decisions or lack of consensus in developing common Islamic financial instruments, and the overall establishment of a financial profile in the jurisdiction. Even in the regulation or reliability of a single jurisdiction or region, the acceptability of an Islamic product or service can vary from branch to branch, making it clear that interest lies in relatively few jurisdictions around the world. Yet, a worldwide haze prohibits the use of Islamic financing without a unanimous socio-economic and ethical consensus.
New customers demand new and innovative products with clear requirements, but these products must be sophisticated enough to adapt to the latest developments. At present, ethical consumers represent the largest part of a new group of customers, which is around 41% of the total world population’s bankable population. The transition from conventional financial products to ethical asset products is projected to reach a trillion dollars in 2020. The prospects for the future in the era of digital banking are for safe financing and for Islamic products as well. The trends in Muslim investment have increased and defined motivations largely based on faith and nationality. The transformation towards digital banking is favorably modifying the competitive scenario for the viability of Islamic banks. This will also change the role of Fintech in shaping the services and products of those Islamic banks. With the demand for halal products in food, cosmetics, and tourism, the potential for the European, USA, CIS, and South Asia markets is rising. A low estimate of normal growth of 15% per annum provides a financial alternative for global ethical spending, focusing heavily on Islamic products, including ethical spending. Proceeds aim to provide millions in capital for profitable companies. Ethical banks have accounted for an average of 80% of the world’s total since 2008 and are also the highest in the entire banking system. In terms of banking management, few Islamic banks are also performing well. As the future trends are listed above, there is a very good opportunity for a career in the Islamic financial industry. These pathways are inclined to lead to sectors aiming to advance Islamic finance. Professionals should also continue to follow developments in the industry to join professional associations.
Understanding the Islamic principles behind the industry is an excellent starting point for anyone considering opting for a career in Islamic banking and finance. Opportunities for career growth are abundant and the variety of areas in which one can specialize or pursue a career is vast. With sufficient education, skills development, and networking, success as an Islamic banker seems guaranteed. However, there are a few challenges facing the industry, including a lack of standardization, a shortage of qualified employees, and a lack of diversity. For individuals looking to have a successful career in Islamic banking and finance, this means that they must be prepared to face these problems as they enter the industry. Furthermore, they must be prepared to see the changes that are on the horizon. The implementation of digital finance or FinTech technologies is expected to have a major impact on the industry in the coming years and decades. This means individuals must stay ahead of the curve when it comes to their qualifications, knowledge, and skills. At the end of the day, a career in Islamic banking and finance can be truly rewarding. It allows for the application of faith and values to work and finance, making success in business or employment ethical. A person’s career in Islamic finance can have a profound effect on a society, making it a desirable and rewarding job. People who want to get ahead in their careers in Islamic banking and finance must be proactive in all professional aspects, recognizing opportunities as they come and adjusting accordingly.
