The growth and challenges of Islamic finance in Thailand
The study investigates the growth and challenges encountered by Islamic 7inance within the context of Thailand with recommendations are provided to address these challenges.This study utilised both descriptive and analytical methods. The data was gathered and examined from a range of sources a...
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| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Penerbit Universiti Kebangsaan Malaysia
2024
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| Online Access: | http://journalarticle.ukm.my/24025/1/IJIT_25_15.pdf http://journalarticle.ukm.my/24025/ http://www.ukm.my/ijit/ |
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| Summary: | The study investigates the growth and challenges encountered by Islamic 7inance within
the context of Thailand with recommendations are provided to address these
challenges.This study utilised both descriptive and analytical methods. The data was
gathered and examined from a range of sources and an in-depth personal interview with
an individual knowledgeable about Islamic Finance in Thailand. The preliminary results
of the study reveal the growth and expansion of Islamic 7inance in Thailand has
presented numerous challenges. Despite of that, it has managed to secure a substantial
share of the overall 7inancial system. In 2022, the aggregate value of Islamic 7inancial
assets experienced a year-on-year growth of 5.56%, reaching a total of THB 128,825
million. These assets were distributed among various segments. The largest segment was
Islamic banking, which accounted for 62.18% of the total assets, with an asset size of
THB 80,110 million. The second largest segment was other Islamic 7inancial institutions,
with an asset size of THB 36,143 million, representing 28.06% of the total assets. The
Takaful segment followed, with an asset size of THB 10,427 million, accounting for
8.09% of the total assets. Lastly, the Islamic fund segment had an asset size of THB 2,145
million, making up 1.67% of the total assets of Islamic 7inancial assets. The study
indicates the signi7icant challenges encountered by the Islamic 7inance industry,
primarily pertain to the legal and regulatory framework governing Islamic 7inance, with
speci7ic emphasis on Islamic cooperatives, takaful operations, and the imposition of
double stamp duty on Islamic contracts. Furthermore, the absence of a centralised
Shari’ah supervisory body for all segments of Islamic 7inance, as well as the lack of
institution-level Shari’ah supervision, pose considerable difficulties |
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