Category Archives: Information Technology

SWIFT goes Shariah compliant for interbank Murabaha transactions

SWIFT goes Shariah compliant for interbank Murabaha transactions


SWIFT has announced that ISO 15022 message standards for the processing of treasury murabaha transactions have been certified compliant with the international Islamic finance standards issued by AAOIFI (Accounting and Auditing Organization for Islamic Financial Institutions). This certification paves the way towards the automated processing of murabaha treasury transactions, said to represent 60 percent of all Islamic financing.

Murabaha includes money transfer and commodity trade. While SWIFT has carried the money transfer for many years, commodity trade has been completed manually, usually by fax without any globally agreed standard. SWIFT’s solution uses the ISO 15022 message standards within the guidelines of a murabaha standards rulebook (the guidelines can be downloaded from

“AAOIFI is responsible for global Islamic finance industry standards and we establish best practices for the industry”, says Mohamad Nedal Alchaar, AAOIFI secretary general. “Our collaboration with SWIFT aims to build a well-structured and well-regulated international Islamic finance infrastructure.”

Alain Raes, SWIFT’s chief executive for Europe, the Middle East and Africa, who accepted the compliance certificate on SWIFT’s behalf at the recent Sibos conference in Amsterdam, adds: “Murabaha automation is the first step on a long journey of collaboration with the Islamic financial community.”

The use of ISO 15022 messages over SWIFT does not change the current process between banks, their customers and brokers. However, the data defined in the schedules under the terms of the master murabaha agreement is now exchanged using standardized messages via SWIFT as opposed to bilaterally agreed confirmations exchanged manually. Participants involved in murabahawill benefit from a globally agreed electronic standard, automation which will lead to a reduction in costs and risk, and an audit trail for Sharia compliance.

More than 240 Islamic banks representing 84 percent of global Sharia compliant assets are members of SWIFT.  Islamic finance is growing at more than 20 percent per annum, and the demand for Shariacompliant messaging standards is increasing as a result. SWIFT is working with the Islamic financial community to address this demand, both at the level of individual banks, and with organizations such as AAOIFI and AIBIM (the Association of Islamic Banking Institutions Malaysia).


Al Baraka Bank Syria goes live with iMAL

Al Baraka Bank Syria goes live with iMAL


Path Solutions, the global provider of software solutions and services to the Islamic finance industry, today announces that Al Baraka Bank Syria has successfully deployed iMAL enterprise banking and investment system with full service offerings to its customers in just 6 months. The solution will enable the bank to meet its growing volume requirements, reduce risk and increase its profitability through STP, automation and centralisation.

“We’ve gone through a whole evaluation process by comparing a number of international software vendors” said Anas Kharrat, IT Director at Al Baraka Syria. “It was imperative for us to select the right partner with a robust Islamic solution that could match the future ambitions and plans of our bank. Path Solutions has developed a record of strong and consistent achievements”. And he further added, “Today, Al Baraka Bank Syria starts its operations using Path Solutions’ industry-focused and user-friendly iMAL system which will enable us to accelerate innovation, increasing the effectiveness with which new Islamic products are created to constantly improve customer experience”.

Al Baraka Bank Syria opted to implement iMAL based on a number of criteria. Path Solutions’ iMAL best-in-class, fully integrated and scalable software solution will give Al Baraka Bank Syria a whole new way of delivering innovative products. It will also increase efficiencies and transparency in banking operations.

Alain Abou Khalil, VP Professional Services at Path Solutions commented, “Al Baraka Bank is the third Islamic bank in Syria running live on iMAL . The successful implementation of iMAL at Al Baraka Syria clearly demonstrates our commitment to providing world class core banking solutions benefiting our clients and marks yet another important milestone in Path Solutions’ success story”.

The implementation of iMAL at Al Baraka Bank Syria covered the following areas: Retail Banking including Branch Automation, Commercial Banking, Corporate Banking, Credit & Facility Management, Automated Teller Machines, Accounting & Finance and Profit Calculation.

Al Baraka Bank Syria is a subsidiary of Al Baraka Banking Group (“ABG”) that has pioneered the development of Islamic banking and finance. The group has a wide geographical presence in the form of subsidiary banking units in 12 countries, the latest was Syria. The authorized capital of ABG is US$1.5 billion. The capital of Al Baraka Bank Syria is of 5,000,000,000 SYP.

Kuwait Finance House appoints ITS to provide integrated ‘Ethical Banking’ solution

Kuwait Finance House appoints ITS to provide integrated ‘Ethical Banking’ solution


Kuwait Finance House – Bahrain (KFH-Bahrain) announced today that it has appointed the computer group International Turnkey Systems (ITS) to provide an integrated ‘Ethical Banking’ solution to support the Bank’s expansion plans.

The one year contract includes upgrading the Bank’s core banking system, integrating the branch automation system, trade finance, Islamic finance, internet banking, in addition to services related to human resources and treasury. The combined solutions will benefit the customer by providing greatly enhanced services from the Bank.

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Islamic Finance "a window of opportunity" for IT professionals

The Hindu Business Line: Islamic Finance “a window of opportunity” for IT professionals

When the going gets tough, the smart ones look for alternatives.

A clutch of IT companies are bullish on an ‘under-penetrated financial services domain’, which they claim will not be negatively impacted by the US credit crunch. What’s more, even global banks that have burnt their fingers in the U S sub-prime crisis are keen on action in this space, making the demand environment even more vibrant for Indian IT companies, they say. There are projections of this market reaching the $1-trillion mark in the near future.

Welcome to the world of Islamic banking.

What is this all about?

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Dubai Islamic Bank launches new virtual training centre

Dubai Islamic Bank launches new virtual training centre

Dubai Islamic Bank (DIB) announced today the launch of the DIB Retail Banking Services Virtual Training Centre in Dubai.

The initiative will provide bank staff with advance training, experience, skills and insights to better meet the needs of the bank’s clients in retail banking services. The DIB Retail Banking Services Virtual Training Centre is located at the DIB branch on Al Ittihad Road in Dubai.

The opening ceremony for the centre was attended by Khaled Kamda, DIB Group Managing Director and Chief Executive Officer, and several other senior executives from the bank. The training centre is based on a partnership with SnapShot, a leading human resources consultancy and training firm.

The training centre is one of the most sophisticated centres in the country. The centre is seen as a means for DIB to develop and improve the level of service for the banking sector throughout the region. “This initiative is a reflection of our commitment to being a financial services institution that delivers the highest level of service to its customers,” said Kamda.

“The emphasis we place on training has benefited not only our customers and employees, it has also benefited the emirate’s economy. In line with our efforts to lead the banking industry in the area of Emiratisation, we have produced a National workforce that is highly educated, motivated and well trained.”

Kamda added: “We have received many accolades due to our position as the pre-eminent Islamic financial institution in the country and the region. This has been achieved by our steadfast dedication to providing employees with the expertise necessary to work across the entire spectrum of the banking industry. On behalf of everyone at Dubai Islamic Bank, I am extremely pleased to announce the launch of this new training centre.”

Along with theory, DIB employees attending the training centre can acquire hands-on experience, through such techniques as role playing. “We have created a facility that duplicates a bank branch,” said Mohammed Amiri, Retail and Business Banking chief of DIB.

“The centre gives employees the chance to hone their skills by placing them in a variety of banking scenarios. The courses we have created are 70 per cent practical and 30 per cent theoretical. The goal is to equip employees with the abilities required to take on nearly any issue that may confront a bank branch.”

SnapShot helps to empower the institutions it works with by providing key information that will enable them to conduct and pursue solutions comprised of three elements: reliability, effectiveness and measurability. “Our partnership with DIB is a long-term partnership that is based on a clear understanding of requirements and mutual cooperation,” said Dr. Fuad Jassim, Executive director of SnapShot.

The training centre is just one of several facilities DIB has created in recent years for its employees. In 2007, DIB created the DIB Training Academy for both management and staff. Like this training centre, the academy’s purpose is to increase the skill sets of its employees, and maintain the highest quality of service possible for the bank’s customer base.

Pakistan’s Dawood Islamic Bank live with Internet banking solution

Pakistan’s Dawood Islamic Bank live with Internet banking solution

Pakistan’s Dawood Islamic Bank has successfully gone live with SunGuard’s System Access Customer Service Manager.

This was announced in a message received from Singapore on Thursday. It said SunGard announced Thursday that Dawood Islamic Bank Limited (DIBL), the sixth Islamic bank to be licensed by the State Bank of Pakistan, is now live with SunGard’s System Access Customer Service Manager to provide a solution for personal and corporate Internet banking facilities.

System Access Customer Service Manager will help DIBL to provide its corporate and retail clients with more convenient self-service facilities, while helping reduce its operational costs. It was further pointed out that in December 2007, DIBL went live with SunGard’s System Access Core Banking solution for its Islamic Banking operations.

With System Access Core Banking in place, DIBL set its sights on extending its customer touch-points beyond its branches. DIBL selected System Access Customer Service Manager to provide Shariah-compliant online retail banking services as well as online payments and trade finance facilities for its corporate customers safely through the Internet.

Path Solutions wins “Best Islamic Finance Technology Award”

Path Solutions wins “Best Islamic Finance Technology Award”

Path Solutions, the leading provider of ethically-aware software solutions to Islamic financial institutions today announced that it has been recognized as the “Best Islamic Finance Technology” at the Islamic Business & Finance Awards 2007, which took place on 12th December at the Emirates Towers Hotel in Dubai.

The Islamic Business & Finance Awards 2007 have been designed to recognize and reward excellence throughout the global Islamic finance community. They honor Islamic financial institutions from around the world and emphasize the importance and increasing attraction of Islamic finance.

Winners of the award were decided by the readers of Islamic Business & Finance Magazine who have completed casting their votes for contestants from a shortlist created by a judging panel of rating and consulting firms and were judged with greater transparency by their peers based on their performance over the last twelve months.

“We’re obviously very pleased to be selected by the readers of Islamic Business & Finance Magazine for this highly exclusive award”, noted Ahmad Al Sager, Chairman of Path Solutions. “It is an honor to be recognized for efforts and achievements and the value we have added to Islamic banking. Over the past year, we have invested heavily in our Sharia-compliant software and we have consistently demonstrated our ability to deliver low-risk, cost effective implementations in record time, as we are committed to offer our customers significant business advantages and maximum ROI”.

Mr. Al Sager added: “This is an exciting phase in Path Solutions’ growth. Having carved a niche for ourselves in the Islamic banking domain, we will strengthen our footprint in the Gulf, Middle East, UK, South East Asia and Africa. Islamic financial products are fast becoming the favorites of the global banking industry, and we have the most cutting-edge and cost-effective solution in the IT market, a robust and proven solution that has been implemented so far in over 40 major financial institutions”.

And he concluded: “In our business, we know only one direction—forward. More precisely, we have got some exciting plans for the coming years which I cannot share in huge detail yet, but will include further developing of innovative products, and we are looking forward to even more collaboration to create greater customer satisfaction”.

The Islamic Business & Finance Awards were launched in 2005 in response to the phenomenal growth of the Islamic finance industry, currently estimated at $500 billion in value. They are currently the recognized industry awards across the globe with multiple award categories.

Commenting on the victory, Naji Moukadam, Path Solutions’ President said: “We are thrilled to have won one more prestigious contest. It is with no doubt a point of pride for us to be the finalist in the “Islamic Finance Technology” category. We feel it is an investment that has yielded rich returns. Hopefully we are taking a step towards a brighter future”.

Islamic Business & Finance Awards 2007 were presented to winners of the different categories in the presence of Arab and foreign dignitaries and senior representatives of major Islamic financial institutions.