Industry Article

Minister of Home Affairs Azleen Ahmed has launched the 2nd International Halal Management Conference (IHMC) on the 18th July 2018 at the Maldives National University (MNU). The IHMC was organized by the Maldives Center for Islamic Finance (MCIF) and the MNU along with Universiti Sains Islam Malaysia. More than 50 international speakers representing more than five countries participated in the conference.

The 2nd Maldives Islamic Banking and Finance (MIBFI) Conference has acted as a forum where the Islamic banking and finance fraternity converge to discuss a plethora of issues. While the local players took center stage, the participation of foreign delegates complemented the Maldivian participants in engaging one another in discussions relating to the future prospects of the Islamic banking and finance industry in Maldives and beyond. This year's theme of the conference was 'Creating a center of Islamic Finance'.

The Maldives has embarked on the huge task of developing Islamic finance parallel to its existing conventional finance market. After establishing its very first Islamic bank in March 2011, the country also witnessed the issuance of its first Islamic equity in 2011. The first company in Maldives that was listed as a company issuing Shariah compliant equity was Amana Takaful Maldives. The country is subsequently moving towards the development of a sukuk market.

Microfinance is a new concept in the Maldives. In 2015, the first Islamic microfinance scheme was introduced under the name of "FaseyhaMadadhu" with assistance from Islamic Development Bank. The products developed under this scheme were unique as it was shaped by looking at local needs. This paper will discuss these products and the features of it. It is hard to find literature about the subject matter as this is a newly introduced scheme and the first-hand experience of the author in structuring and implementing the scheme has been relied extensively. It is anticipated that the outcome of this paper will pave the way for those jurisdictions that aim to introduce Islamic microfinance

Ever heard of an occasion where property has been used to generate revenue to a waqf fund? Well, here's one. It's called the Dharul Eeman project and is being tried and tested in the Maldives. We hope that its success story will be an inspiration to other countries who wish to adopt a similar approach to enrich their cash waqf funds. This project is proof that innovation is the key to developing an Islamic economy. This model is unique as the general norm is to develop properties to generate income from waqf lands; but in this case the Ministry of Islamic Affairs is intending to develop a land in order to generate income for a cash waqf fund which will be used to build, repair and maintain mosques all over the nation.

Amana Takaful Maldives (Amana Takaful) held its eighth annual general meeting (AGM) on the 28th April 2019 in the Republic of Maldives. During the meeting, the minutes of the 2018 AGM were adopted and the annual report of the board of directors on the affairs of the company for the year ended the 31st December 2018 and the report of the auditors were passed, among other things.

Amana Takaful Maldives has announced the declaration of dividends for the year 2022. During the 12th Annual General Meeting held on the 22nd May 2023, shareholders approved a final dividend of 15% on the face value of each share. The total amount of this dividend is MVR3.95 million (US$255,819). When combined with the interim dividend paid in November 2022, the total dividend for the year 2022 amounts to MVR6.58 million (US$426,150). The books for dividend distribution were closed on the 10th May 2023, and only shareholders registered on or before that date are eligible to receive the dividends. According to Section 55(a)(4) of the Income Tax Act (Law No 25/2019), the company is required to deduct 10% from the dividends paid to non-resident shareholders. If it is unclear whether a shareholder is a resident in the Maldives, they will be treated as a non-resident, and the company will deduct a non-resident withholding tax of 10% from their dividend payment. Shareholders are encouraged to update their residency status with the company. On the 13th May 2023, the Islamic Corporation for the Development of the Private Sector (ICD) and Amana Takaful Maldives signed an MoU to establish a collaborative partnership.

Amana Takaful Maldives (Amana Takaful) has announced its interim dividend payment to its shareholders for the year 2017 based on its commendable performance. Amana Takaful reported a profit of MVR4.8 million (US$307,625) in the first seven months, ending July 2017, compared to a growth of 21% over the same period in 2016. In addition, gross written premiums worth MVR80 million (US$5.13 million) were recorded, showing a notable growth with higher volumes in the leading classes.

The Bank of Maldives has announced the appointment of Hassan Kalaam as the new director of Islamic banking in a press release dated the 7th February 2022. Hassan is a licensed Shariah advisor with more than 10 years of experience in the financial services and banking industry. Since joining the bank in 2013, Hassan has played a key role in contributing to the success of the bank's steadily growing Islamic banking arm.

According to a press release from the Bank of Maldives (BML) dated the 22nd January 2025, the institution proudly marks a decade of pioneering Islamic banking services in the Maldives, reflecting the nation's increasing demand for Shariah compliant financial solutions. Since launching its Islamic banking division, BML Islamic, the bank has been steadfast in providing fully Shariah compliant banking solutions with complete segregation of funds, aligning with international standards. In line with its vision to prioritize Islamic finance, three branches in Eydhafushi, Mahibadhoo and Gan have been rebranded exclusively as BML Islamic branches, further embedding the 'Islamic Finance First' philosophy in its operations. Commenting on this milestone, Mohamed Shareef, CEO and managing director of BML, stated: "Celebrating 10 years of BML Islamic is a proud moment for Bank of Maldives. As the largest Islamic bank in the Maldives, we offer a comprehensive suite of products including accounts, cards and financing. BML Islamic was the first to introduce innovative services such as Islamic overdraft financing, cash financing, hybrid home financing, Islamic debit cards and the Maldives' only Shariah compliant credit card. These branch updates underline our commitment to meeting the evolving needs of our customers."

A new Islamic deposit account, the Wadiah Business Account, has been introduced by BML Islamic, the Islamic finance arm of the Bank of Maldives (BML) on the 7th December 2015. The tagline used in the introduction of this type of account is: The Shariah compliant current account facility for your business. This newly introduced account is not merely an account with a current account facility but it provides added services such as instant and secure internet banking and professional support through the BML Islamic Advice Center for more advanced Islamic banking-related advisory services.

The opposition coalition that won the presidential election in the Maldives on the 23rd September 2018 has the first-ever political manifesto to contain a special agenda for the development of Islamic fi nance, demonstrating the evergrowing demand for Islamic finance in the Maldives.

The Capital Market Development Authority (CMDA) is the regulator for the capital markets in the Maldives. In May 2011, the CMDA took the initiative to develop a fully-fledged Islamic capital market in the Maldives and the first step towards this vision was to establish a Capital Market Shariah Advisory Committ ee (CMSAC).

Halal and haram is a concept which every Muslim must adhere to in all their daily affairs. Halal and haram are not terminologies relevant only for food or consumable items. In Shari'ah, the concept of halal and haram is also to be applied in muamalat or commercial matters. In short, all affairs of human must be based on doing what is halal or permissible and abstaining from what is haram or forbidden. According to Thomson Reuters' State of the Global Islamic Economy 2018/19 report, there are 1.8 billion Muslims in the world whose spending was estimated to be $2 trillion in 2017. In addition to Muslims, who made up a quarter of the world population, there are people of other faiths and backgrounds who has also subscribed to the principles upheld by Shari'ah such as human treatment of fellow mankind, animals and the environment. Therefore, there is a big market for halal goods and services.

The Strategic Plan 2018-22 (the Strategic Plan) of the Maldives Monetary Authority (MMA), the central bank of the Maldives, was launched on the 23rd July 2018. In his inauguration speech, the MMA's governor, Ahmed Naseer, stated that the new strategic action plan for the next four years aims to revolutionize the payment system in the Maldives. The MMA's vision is to become a credible, independent and contemporary central bank committed to maintaining price stability and promoting inclusive, sustainable economic growth. The MMA's mission is to promote the international value and stability of the Maldivian rufiyaa, develop a secure and efficient payment system in the Maldives and foster a sound financial sector conducive to the orderly and balanced economic development of the Maldives. The Strategic Plan was launched by Minister of Finance and Treasury Ahmed Munawar and Minister of Tourism Moosa Zameer and comprises six major objectives.

Harith Harun, the first CEO and managing director of Maldives Islamic Bank, has retired on the 31st March 2018. Harith is a Malaysian citizen who has contributed toward the creation of a fully-fledged Islamic finance industry in the Maldives. He played an instrumental role in creating the Islamic monetary market and other Islamic finance institutions that emerged in the country. The stakeholders of the Islamic finance industry are of the view that Harith leaving the position of the managing director of Maldives Islamic Bank is a loss to the industry. However, Harith will still serve as a director of the bank.

The Maldives is a country with limited resources. The lifeline of the economy is fishing and the golden goose of the country is tourism. The country also heavily depends on importation of goods. The financial system of the Maldives is based on conventional rules and laws. The financial and the economic system of the country are based on conventional economics and financial principles.

The Women On Boards (WOB) NGO has signed an MoU with the Maldives Center for Islamic Finance (MCIF) on the 19th December 2016. This MoU is part of the efforts by WOB to bring women into Islamic finance. The areas of collaboration include maintaining a register of women in Islamic finance, collaborating with the MCIF on training and awareness of Islamic finance for women, research and development and working together overall to bring women into Islamic finance. This is indeed a remarkable effort to increase female participation in the Islamic finance industry.

The term universality has many meanings. The Webster Dictionary defines the term as: "of or pertaining to the universe; extending to, including, or affecting, the whole number, quantity, or space; unlimited; general; all-reaching; all-pervading; as, universal ruin; universal good; universal benevolence or benefice." For the purpose of this article, the meaning of universal would be restricted to 'unlimited', 'general', 'all-reaching', and 'all pervading only. The objective of this new concept proposed is to ensure that the universality aspect of Islamic finance is reflected in one concept using different mechanisms used in it. The government of the Maldives, via the Maldives Center for Islamic Finance, is embarked in implementing an innovative concept of Islamic finance that could combine the concept of waqf and Islamic tourism to create a sustainable fund which will be utilized to alleviate poverty. This concept is similar to the story of Robin Hood.

Participants in crop takaful would be compensated for any loss or damage suffered due to any of the aforementioned calamities. Crops covered in this takaful product include papayas, brinjals, butternuts, watermelons, pumpkins, cucumbers, melons and bananas. The sum covered will be automatically calculated based on the selected crop type and harvesting land size. Apart from crop takaful, takaful products offered by Ayady Takaful include comprehensive motor takaful, third-party motor takaful, expatriate plus takaful, health takaful, travel takaful, hull takaful and hajj and umrah takaful. Ayady Takaful also offers both general and family takaful products. Currently, there are five insurance companies registered with the Maldives Monetary Authority (MMA) in the Maldives and among them the only fully-fledged takaful company is Amana Takaful Maldives; Allied Insurance Company of the Maldives is the only company with an Islamic window to offer takaful under its brand name, Ayady Takaful.

Tourism is the lifeline and the golden goose of the economy of the Maldives, the number one honeymoon destination in the world. Tourism is a sector that has shown progressive growth in the country and the largest contribution to the GDP of the country comes from this sector, proving that tourism is the most profitable sector in the country to be invested in. However, although the Maldives is a 100% Muslim nation, the country is alien to the concept of Islamic tourism. With the rapid development of the Islamic finance industry in the country, the urge to test the practical applicability of Islamic tourism in the Maldives has grown. The year 2016 has proved that Islamic finance is here to stay and the country has novel developments that will hopefully realize in the next year which will lead to the sustainable development of Islamic finance in the country.