Newly minted digital supply chain platform TFX Islamic is looking to expand into key Islamic markets, with plans to foray into different segments of Shariah finance beyond supply chain finance, IFN has learned.
TFX Islamic’s geographical expansion strategy is driven by the international ties it has with its parent company, headquartered in Singapore, which is in turn indirectly owned by Hong Kong entities.
“Even before we started, we always knew that scaling beyond Malaysian waters is something we have to do,” Norita Ja’afar, CEO of TFX Islamic, tells IFN. “We are hoping that this will be announced soon as to our plans, but yes, we have plans to go to the Islamic markets that we feel are untapped in supply chain finance.”
Opening its doors in Malaysia just this month, TFX Islamic sees opportunities in Asian Islamic markets including Bangladesh and Pakistan. The deciding factor, however, would be a combination of commercial potential and, equally if not more importantly, enabling regulatory infrastructure.
“The challenge with Islamic supply chain finance is that the treatment of Islamic compliance differs from one market to another as there is no standardization. To translate that into the technological processes when the regulations themselves are very vague is a challenge,” Norita explains. “If we were to scale overseas, we have to see the market opportunities for Islamic [finance] but also see whether the regulators are ready for fintech [companies] to do Islamic treatment.”
In line with its Singapore parent, TFX Islamic’s current mandate is supply chain finance; however, the firm identifies as a technology company first and is exploring other areas of Islamic finance to venture into, with a core SME focus.
“Over time, you will hear us advancing in our technology space — we will not just be focusing on buyer-led financing because we are a tech company first. We hope to establish more partnerships with more banks locally and overseas,” Norita shares.
This is an excerpt of an interview with Norita Ja’afar, CEO of TFX Islamic. To listen to the full discussion on Shariah supply chain finance, log on to IFN Podcasts.