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Market research analysts at Technavio have predicted that the global Sukuk market will grow steadily during the forecast period and will post a CAGR of more than 8% by 2020. This market research analysis identifies the diversification of investment pattern in emerging countries as one of the primary growth factors for this market.
Many Islamic banking institutions have already started seeking strategic partnerships with foreign financial institutions to step up expansions in foreign countries and also benefit from opportunities in untapped markets. The rising disposable incomes have also encouraged more people to invest in Shariah-compliant products. Moreover, the increasing competition, the growing demand with greater sophistication, and innovation in products and services will also add to the growth of the market.
Islamic finance products like Sukuk are considered unique in the financial sector. Mature and developing Islamic markets are facing shortages in technical expertise in terms of product innovation and in driving sales. The establishment of Islamic finance products in different geographies will help target both Muslim and non-Muslim populations, under the guidance of Muslim scholars. This will create a rise in the awareness for providing globally accepted qualifications that will help industry professionals to develop their professional careers. Also, the market will also witness a number of outsourcing and white labeling activities.
The market is characterized by the presence of several well-established and regional vendors. Owing to their favorable demographics and strong macroeconomic fundamentals, the South East Asian countries hold the maximum potential for growth in Islamic products. To enhance the operating model, to attract large numbers of depositors, and to expand its credit services, vendors in the industry have the need to customize their products. Vendors will also start creating separate MSME (micro small and medium enterprises) business units to develop private equity and venture capital practices and will also deduce strategic moves to enhance the current clientele. Islamic banks will also start focusing on expanding their channel capabilities to offer customized products and services.
The leading vendors in the market
This market study estimates that in terms of geography South East Asia will account for more than 76% of the total share of the market by 2020 and will also dominate this market throughout the forecast period. Sukuk bonds are expected to perform well during the predicted period and will result in attracting foreign issuers from different regions. Also, Sukuk is based on asset-based securitization methods, and this will make it ideal to finance highway networks, new ports, and other infrastructure projects in the coming years.
Modern banking customers often transact online and also use the cyber domain to relate their user experience. This will induce Islamic banking and financial institutions to invest in analytics to offer their customers with better user experience and customized products. Also, the use of social media analytics will also enable these institutions to gauge customer expectations, perceptions, and experiences.
This report provides a number of factors contributing to the adoption, limitations, and opportunities of the global Sukuk market. It also offers an analysis of each factor and an estimation of the extent to which the factors are likely to impact the overall market growth.
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Related reports
PART 01: Executive summary
PART 02: Scope of the report
PART 03: Market research methodology
PART 04: Introduction
PART 05: Market landscape
PART 06: Geographical segmentation
PART 07: Market drivers
PART 08: Impact of drivers
PART 09: Market challenges
PART 10: Impact of drivers and challenges
PART 11: Market trends
PART 12: Vendor landscape
PART 13: Competitive landscape
PART 14: Appendix
PART 15: Explore Technavio
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