The Islamic Finance Coordination Forum (IFCF) affirms the commitment of member-agencies for calibrated initiatives in promoting Islamic banking and finance in the country.
Typifying the whole-of-government approach, the Bangko Sentral ng Pilipinas (BSP)-led IFCF is tasked to facilitate discussions, collaboration, and cooperation among members on all matters related to the promotion and development of Islamic banking and finance.
This includes coordination on regulatory and prudential policies and initiatives.
“The BSP values the strong commitment of each IFCF-member-agency/institution in undertaking, prioritizing, and coordinating relevant initiatives that complement the BSP’s prudential regulatory reforms and initiatives on Islamic banking and finance,” said BSP Assistant Governor Arifa A. Ala, lead advocate on Islamic banking and finance and IFCF Chairper son.
“Our close collaboration and strong cooperation under the IFCF has led to the achievement of significant milestones, such as the establishment of the Shari’ah Supervisory Board in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), the issuance of Bureau of Internal Revenue regulations to implement tax neutrality, and the issuance by the Insurance Commission of baseline regulations on takaful (Islamic insurance). These jumpstart the growth of the Philippine Islamic capital market and takaful; and make our country ready for the entry of Islamic finance players and investors,” said Assistant Governor Ala.
To accelerate the promotion and development of Islamic banking and finance in the Philippines, the IFCF is planning to conduct a market demand study and possible roadshows to show prospective local and international stakeholders, investors, and players the viability of the Philippine Islamic finance market; finalizing preparations for a maiden Sovereign sukuk issuance; and formulating and implementing Islamic finance-related programs, activities, and projects in the BARMM.
The IFCF is the formalized platform of the then Interagency Working Group on Islamic Banking and Finance mandated to jumpstart collaboration among the stakeholders in finalizing the draft bill that was enacted into the Islamic Banking Law in 2019.
The forum is now composed of 12 member-agencies/institutions, namely, the BSP, Asian Development Bank, Auditing and Assurance Standards Council, Bangsamoro Government, Bureau of Internal Revenue, Bureau of the Treasury, Department of Trade and Industry, Insurance Commission, National Commission on Muslim Filipinos, Philippine Deposit Insurance Corporation, Philippine Financial and Sustainability Reporting Standards Council, and Securities and Exchange Commission
The BSP will continue to foster collaboration and cooperation under the IFCF and with other relevant stakeholders to spur the development of the Philippine Islamic banking industry and fully realize the shared vision to develop a vibrant Islamic finance ecosystem in the country.
Recently, he Islamic Banking and Finance (IBF) Core Team of the Bangko Sentral ng Pilipinas was named regional winner of the Presidential Lingkod Bayan Group Award for their work in developing Islamic finance in the country.
The group’s efforts have strengthened stakeholder engagement and inter-agency cooperation, implemented key regulations and built capacities to support the Islamic Banking Law.
The BSP’s IBF Core Team is headed by Assistant Governor Arifa A. Ala and includes as members Deputy Director Noel P. Tianela, Deputy Director Maria Luisa O. Nieva, Manager Anna Lisa B. Atienza, and Bank Officer V Winnie Claire L. Jamoner-Carbonel.
The IBF Core Team played a major role in the enactment and prompt implementation of the Islamic Banking Law. This led to the establishment of a clear legal framework for Islamic banking and finance as well as the creation of an enabling regulatory environment, where Islamic banks can viably operate on a level playing field alongside conventional banks.
Recognizing that Islamic finance is a whole-of-government undertaking, the IBF Core Team steered the creation of the 12-member Islamic Finance Coordination Forum tasked to implement the Islamic Banking Law. This facilitated a more efficient engagement, collaboration, and harmonization of key priorities and efforts on Islamic finance.
The working group is led by the BSP and composed of the Bureau of the Treasury, Insurance Commission, Philippine Deposit Insurance Corporation, Bureau of Internal Revenue, Bangsamoro Government, National Commission on Muslim Filipinos, Securities and Exchange Commission, Department of Trade and Industry, Financial Reporting Standards Council, Auditing and Assurance Standards Council, and Asian Development Bank.
The IBF Core Team also initiated the establishment of the BSP’s Islamic Banking Supervision Group, which is focused on the development of Islamic banking frameworks and policies. The team also spearheaded capacity building programs for stakeholders from the public and private sectors.
Islamic banking refers to a banking business that has objectives and operations that do not involve interest (riba) as prohibited under Islamic laws and that conducts its business in accordance with the principles of the Shari’ah.
The Islamic Banking Law fosters greater financial inclusion among underserved Filipinos, both Muslims and non-Muslims, by providing quality banking products and services.
It expands the funding base for small- and medium-sized enterprises, and opens the stage for Islamic banking players who wish to broaden their operations in the country.
