Blockchain paves the way for genuine innovation in Islamic finance

(MENAFN – Gulf Times) With the coronavirus continuing to ravage the world and close to a fifth of the world’s population — or 1.5bn people — being asked or ordered outright to stay home and work remotely as new virus infections soar, the importance of digital technology for our lives in the current situation has become clear even to the technically most uninclined.
There has been a boom in digital services as that the virus is forcing us to use the Internet as it was always meant to be used, to connect, share information and resources and come up with collective new solutions. Applications some of at least the older generations might not even have heard of such as WhatsApp, Instagram, Zoom, Skype, Periscope, Spaces or Oculus found their way in thousands and thousands of households, while schools introduced digital home learning and companies virtual co-working, while personalised businesses such as real estate agencies, gym trainers, cosmetic studios, healthcare services, financial advisers and many others and have turned to virtual reality to stay connected with customers. Even many religious services are now being held via online livestreams rather than in person. All this means that a new digital culture has been established that will likely not go away after the coronavirus has.
What does this mean for Islamic finance? It means that digital innovation will be of massive importance in the future and now is the best time to start focusing on it. There is already a growing number of fintech start-ups in Islamic finance, but most are creating non-core applications such as group lending or equity crowdfunding schemes, charity ecosystems, merchant platforms or certain digital banking services.
However, the most effective innovation in fintech, and also for Islamic finance, is the revolutionary blockchain technology because of the multitude of potential applications, many experts agree.  Based on peer-to-peer topology,…

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