The IAIF, in line with its 10th annual conference, held the 1st pre-session of the conference on The Role of Technology in Increasing Public Participation in Islamic Financial Markets, on October 21, at 2:00 PM Iran standard Time.

The speakers are as follows:

1- Dr. Hossein Mohammadi, Faculty Member of Zanjan University and IAIF Member

2- Dr. Aishath Muneeza, Professor of Islamic Finance, INCEIF University, Malaysia

3- Dr. Nikmatul Masruroh, Lecturer at the Faculty of Economics and Islamic Business and Economic Shariah, Haji Achmad Siddiq Jember University, Indonesia

Dr. Aishath Muneeza’s lecture:

Prof. Dr. Aishath Muneeza, Associate Dean of Students & Internationalization at INCEIF University, explored how technological advancements are transforming public engagement in Islamic financial markets, with a special focus on innovative models for social finance.

Prof. Aishath opened her talk by defining Islamic social finance highlighting the traditional challenges faced in Islamic social finance, such as inefficient fund distribution, lack of transparency, and barriers to public participation. She emphasized how technological innovations are providing transformative solutions to these issues.

1. Crypto Zakat: A Blockchain-Based Platform

Prof. Aishath discussed the concept of Crypto Zakat, a cutting-edge platform built on Ethereum blockchain technology. This system enables:

Decentralized collection and disbursement of zakat funds, removing the need for intermediaries.Real-time transparency for both donors and recipients, enhancing trust in the system.Empowerment of zakat organizations to directly transfer funds to beneficiaries, ensuring efficiency.2. IoT for Targeted Zakat Delivery

In another innovative example, Prof. Aishath explained how the Internet of Things (IoT) can be leveraged to revolutionize zakat distribution:

Sensors installed in homes can monitor real-time poverty levels, identifying eligible households without manual surveys.Automated systems can trigger immediate disbursement of zakat, ensuring timely aid without repeated registrations.This system not only reduces administrative costs but also ensures targeted delivery of assistance.

In conclusion, Prof. Aishath stressed that adopting technologies such as blockchain and IoT is crucial to improve the effectiveness and inclusiveness of Islamic finance. Her forward-looking recommendations urged stakeholders to embrace these innovations to ensure efficient fund management, transparency, and greater public participation.

Dr. Nikmatul Masruroh’s lecture:

Dr. Nikmatul Masruroh, Lecturer at the Faculty of Economics and Islamic Business and Economic Shariah, Haji Achmad Siddiq Jember University from Indonesia, focused on the Role of Technology in Increasing Public Participation in Islamic Financial Markets: Evidence from Indonesia

She added Indonesia is the country with the largest Muslim population in the world. However, unfortunately, the Islamic financial literacy index and the Islamic financial inclusion index are still relatively low.

Dr. Masruroh stated in 2023, the literacy index for Islamic finance stood at only 39%, while the inclusion index was around 12%. Nevertheless, these figures have shown an increase from the previous year. Therefore, product innovations continue to be made to improve these indices, especially innovations related to technology, so that people can have more trust in Islamic finance.

The professor of Haji Achmad Siddiq Jember University emphasized the (Indonesian) Financial Services Authority continues to make efforts to increase literacy and inclusion among the public. Technology is indeed one of the keys to the progress of Islamic finance in Indonesia, but its presence not only brings positive impacts but also negative ones.

She also said the low literacy rate in Islamic finance has led some groups to fall into illegal online loans. Therefore, to address this issue, collaboration between the government, the Financial Services Authority, business actors, and the public is needed to ensure that the technological climate in Islamic finance can function well.

Dr. Hossein Mohammadi’s lecture:

Dr. Hossein Mohammadi, a faculty member of Zanjan University and a member of the Iranian Association of Islamic Finance, addressed the issue of technology as a means to pave the way for transparency for capital market actors.

At the beginning of his presentation, he discussed the differences between the capitalist system and the distribution of wealth based on democratization, referring verses from the Holy Qur'an in this regard. Dr. Mohammadi also mentioned the goals of democratization of financing, saying when we talk about technology in this area, it should be mentioned as a means of empowering people to access the markets.

The faculty member of Zanjan University further said technology in the financial field should enables the general public to monitor the financial markets, and in other words, technology should serve justice. He stated that currently some technologies such as artificial intelligence when it is used in the financial field can violate justice. For example, artificial intelligence has access to a significant amount of information, while such a person does not have the ability.

The member of the Iranian Association of Islamic Finance emphasized that financing, in particular economy, should be a human element, and technology should not interfere in such a way as to harm this feature of the economy.

Dr. Mohammadi concluded that technology can lead to the design and improvement of financial products, but on the other hand, one should be careful about some of its features that can violate justice.

It is worth mentioning that the 10th international conference of the Iranian Association of Islamic Finance is held on the 4th of February on “production leap with the participation of the general public in the Islamic financial markets”. The senior economic officials of the country, university professors, students and capital market activists will participate in the event.