Islamic Fund Management
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Infant Market
Markets that fall under the ‘infancy’ stage have the advantage of learning from the experience
of advanced markets, to determine their overarching framework and roadmap for the Islamic
fund management industry. Each jurisdiction evolves differently, taking into account inherent
market conditions and which route to adopt to facilitate successful inclusion. The
recommendations in set preliminary proposals. Since it is a new market with very
little experience, issues and challenges are not applicable.
Table 5.4: General Recommendations for an Infant Market
Pillar 1 – Legal, Regulatory and Shariah Framework
Thrusts Key Recommendations
Develop investors’ trust and confidence in products
and services.
Enforcement of governing rules and regulations to
speed up market development, including the launch
of guidelines on Islamic fund management and the
setting up of policies for investor protection.
Establish comprehensive legal, regulatory and
Shariah frameworks.
Pillar 2 – Development of Institutional Funds
Thrusts Key Recommendations
Facilitate the involvement of institutional funds from
the outset.
Identify institutions as catalysts in promoting
investments in Shariah assets.
Pillar 3 – Liberalisation of Policies and Guidelines
Thrusts Key Recommendations
Promote the liberalisation of policies and guidelines. Institute policy liberalisaton in the roadmap for the
establishment of the Islamic fund management
industry.
Pillar 4 – Tax Framework
Thrusts Key Recommendations
Inculcate fiscal stimulus to incentivise the
involvement of market players (demand and supply)
and accelerate growth.
 Amend tax regime to first create a level playing
field.
 Tax rebates are the quickest route to attracting
retail investments.
Pillar 5 – Market Infrastructure
Thrusts Key Recommendations
Establish a vibrant and effective ecosystem for the
deployment of Islamic funds.
Develop market platforms and infrastructure to
enable the efficient provision of products and
services.
Promote free flow of capital. Liberalisation of capital controls.
Sources: RAM, ISRA