Friday, April 16, 2021
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ReportNew Islamic financing platform for Malaysian credit companies

New Islamic financing platform for Malaysian credit companies

Kuala Lumpur-based Sedania As Salam Capital (SASC) is expanding its tech repertoire with a new platform to support Shariah compliant credit companies.

Known as GoHalal Financing Program, the new platform is designed specifically for licensed moneylenders or community credit companies registered with Malaysia’s Ministry of Housing and Local Government. SASC is building upon its expertise as a commodity Murabahah intermediary and including this component into its latest program which includes the Shariah certification process and advisory on documents, a ready-to-use Tawarruq platform that provides real-time 24/7 trading of digital commodities, digital agreements using automated digital Akad, a secured direct debit e-mandate, Takaful protection, digital marketing services and a financial marketplace.

It seems that SASC, whose clientele include banks and cooperatives, is attempting to engineer a holistic Halal financing digital ecosystem by supplementing financing with Islamic insurance protection as well as combining direct debit e-mandates. This would assist community credit companies to mitigate non-performing financing risks through structured repayment commitments.

The introduction of the new service comes against the backdrop of economic hardships due to the COVID-19 pandemic which has seen the country shut its international borders and swing between full and partial national lockdowns to control the spread of the virus.

“With the extension of the movement control order, these people do not have the financial muscle to absorb financial impacts caused by the lockdown. We hope the program can help address that,” CEO Nisa Ismail said about microbusinesses and workers of informal segments. “We want to foster a safe lending environment and increase the online lending trustworthiness through innovative digital technology.” Islamic financing continues to grow steadily in Malaysia driven by growing demand. As at the end of 2020, the market share of Shariah financing commanded 37% of the total banking market with Islamic financing contributing to nearly all of the banking sector’s 2020 growth, according to Fitch Ratings.

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