The International Islamic Financial Market (IIFM) released the 14th edition of its annual sukuk report, revealing that global sukuk issuances totaled $205 billion in 2024, with international sukuk reaching their highest level since inception.

According to the report, international sukuk issuances rose 24.5% year-on-year to $65.6 billion, supported by improved global liquidity and lower funding costs. However, short-term sukuk declined to $59.1 billion, reflecting reduced domestic issuance and a shift away from short-term instruments.

The report also found that outstanding global sukuk reached $902.8 billion in 2024, with most issuances originating from Bahrain, Malaysia, Saudi Arabia, the UAE, and Indonesia. Emerging markets such as Türkiye, Pakistan, Qatar, Oman, and several African economies are expected to play a larger role in the coming years.

Dr. Ahmed Rufai, acting CEO of IIFM, said hybrid and intangible asset sukuk will be central to the industry’s future growth. “Standardizing documentation for these instruments is the cornerstone of a more mature and stable Islamic finance ecosystem,” he said, noting that harmonization would enhance transparency, reduce issuance costs, and support cross-border financing.

Palm Azgar Finance Company, a licensed financial services provider based in Riyadh, has announced the launch of PUSD, a stablecoin issued through its British Virgin Islands affiliate and fully backed by UAE dirhams (AED) and Saudi riyals (SAR) reserves. The digital asset maintains a 1:1 peg with the U.S. dollar, with reserves held in regulated, Shariah-compliant Gulf institutions.

The company said PUSD is designed to provide a secure, transparent, and accessible bridge between Islamic finance and the global digital economy. Monthly third-party audits will verify that fiat currency reserves fully back each token.

The stablecoin is expected to debut on major cryptocurrency exchanges later this year, enabling faster cross-border payments, decentralized finance (DeFi) participation, and institutional use. According to Palm Azgar, the structure of PUSD ensures users maintain full control over their assets, with no freezing or blacklisting capabilities built into the system.

Founded in Riyadh, Palm Azgar Finance develops Shariah-compliant digital asset solutions aimed at expanding financial inclusion. Its newly launched product, Palm USD (PUSD), reflects growing regional interest in blockchain-based financial tools that combine transparency, Islamic finance compatibility, and real-world asset backing.

Debt capital market (DCM) activity in the GCC is expected to remain robust through 2026, underpinned by a strong issuance pipeline and favorable funding conditions, according to a new report by Fitch Ratings.

Outstanding GCC DCM volumes reached $1.1 trillion in the third quarter of 2025, marking a 12.7% year-on-year increase. Sukuk accounted for more than 40% of total issuances, rising nearly 22% year-on-year, outpacing the 7.2% growth in conventional bonds.

“We expect the GCC debt capital market to remain resilient into 2026, supported by robust issuance, favourable funding conditions, and a high-quality issuer base — over 81% of rated dollar sukuk are investment grade,” said Bashar Al Natoor, Fitch’s global head of Islamic finance. “However, the GCC DCM remains fragmented across its six member countries in terms of maturity, depth, and credit profile, with Saudi Arabia and the UAE the most developed, although all markets saw activity this year.”

Fitch noted that the GCC accounted for 32% of all emerging-market U.S. dollar debt issued in the first nine months of 2025 (excluding China) and is expected to remain among the top emerging-market issuers next year. Continued issuance will be driven by government initiatives to deepen domestic markets, diversify funding sources, finance budget deficits, and address upcoming debt maturities.

Saudi Arabia and the UAE remain the largest DCMs in the region, representing 46% and 30%, respectively, of total outstanding GCC debt. Fitch rates more than 70% of the GCC dollar sukuk market, with 65% of these issuances in the ‘A’ category and nearly 85% on a stable outlook.

While sovereign debt-to-GDP ratios across most GCC economies remain below global peer averages, Bahrain stands as an exception, with Fitch forecasting a ratio of 129% by the end of 2025.

The report also highlighted steady growth in environmental, social, and governance (ESG)-linked instruments. ESG DCM outstanding reached $62.8 billion by the end of the third quarter, with sukuk accounting for nearly half — a 54.1% increase compared with the previous year.

The United Arab Emirates has completed its first government transaction using the Digital Dirham, marking a major step in the country’s push toward a fully integrated digital economy.

The pilot transaction was carried out jointly by the Ministry of Finance and the Dubai Department of Finance, in coordination with the Central Bank of the UAE (CBUAE), the authorities announced on Tuesday.

According to Ahmed Ali Meftah, executive director of the central accounts sector at the Department of Finance, the transfer was executed through mBridge, a multi-central bank digital currency (CBDC) platform developed by the CBUAE. 

The Digital Dirham forms part of the CBUAE’s Financial Infrastructure Transformation Programme, designed to enhance payment systems and advance the UAE’s position as a hub for financial innovation.

The Digital Dirham initiative aligns with the UAE’s broader digital asset and payments strategy, which includes developing regulatory frameworks for stablecoins and digital currencies. Launched in March 2023, the central bank’s strategy requires stablecoins to be fully backed by high-quality liquid assets and subject to independent audits.

In a related development, Abu Dhabi entities IHC, ADQ, and First Abu Dhabi Bank announced plans in April to issue a dirham-backed stablecoin under CBUAE supervision.

Analysts say the move reflects the UAE’s efforts to provide regulatory clarity and infrastructure that supports institutional adoption of digital assets, key factors that could strengthen its position as a leader in financial innovation across the region.

Boursa Kuwait, has reported a 59.81% year-on-year rise in net profit for the first nine months of the year. 

Boursa Kuwait, which operates the Kuwait Stock Exchange, reported $75 million (23.05 million Kuwaiti dinars) in net profit from January through the end of September, compared to $46.94 (14.43 million Kuwaiti dinars) from a prior-year period. 

Operating revenues rose 41.45% year-on-year to $120.5 million (37.06 million Kuwaiti dinars) between Q1-Q3, up from $85.2 million (26.20 million Kuwaiti dinars). 

Total traded value climbed 89.73% to 19.35 billion Kuwaiti dinars in the period ending September 30. Traded volume mirrored the surge, increasing 92.17% to reach 84.23 billion shares. Average daily traded value also rose 91.82%.  

Market capitalization reached 52.61 billion Kuwaiti dinars in the nine months through September, up 24.67% from 42.20 billion Kuwaiti dinars.  

Mohammed Saud Al-Osaimi, Boursa Kuwait CEO, said that the results of the Kuwaiti capital market reflect the tangible impact of the operational and regulatory reforms implemented by Boursa Kuwait and the broader market apparatus. 

Earnings per share surged from 71.85 fils to 114.82 fils during the first nine months of the year. The group’s total assets stood at 132.96 million Kuwaiti dinars as of September 30, up 11.74% compared to 118.99 million Kuwaiti dinar in 2024.

“Boursa Kuwait continues to play a pivotal role in the transformation of Kuwait’s capital market and the development of an integrated financial ecosystem,” said Bader Nasser Al-Kharafi, chairman of Boursa Kuwait. 

“By continuously advancing market infrastructure, enhancing efficiency and transparency, and aligning with international best practices, the company aims to foster an attractive investment environment.”

Boursa Kuwait’s premier market segment recorded a 49.82% year-on-year rise in traded value and 44.61% growth in traded volume. Firms are required to have a free float amount of 45 million Kuwaiti dinars, a seven-year operating history, and a round lot of 450 shareholders with a share value of 10,000 Kuwaiti dinars each to list on the premier segment.

Traded value in the main market surged by 191.32%, accompanied by a 136.38% rise in traded volume.

Boursa Kuwait has eased its listing requirements for the main market segment, decreasing the minimum fair value of freely traded shares not owned by the controlling shareholder group from 15 million to 5 million Kuwaiti dinars. Free-float shares must, however, represent at least 20% of total capital.

A consortium of Kuwaiti investment companies and a global exchange operator acquired 44% in Boursa Kuwait in February 2019. Capital Markets Authority offered its 50% stake in the bourse to Kuwaiti citizens in December 2019. 
 

Bank Negara Malaysia has launched a three-year initiative to test how blockchain-based asset tokenization can be used to modernize key aspects of the country’s financial system, including SME financing and Islamic capital markets. The plan, announced a couple of days ago, builds on the central bank’s existing Digital Asset Innovation Hub and will run through 2027.

The program will involve banks, fintech firms and blockchain developers working within a regulated sandbox to pilot real-world use cases. “This is not about adopting technology for its own sake. Each project must show clear economic value,” the central bank said in its discussion paper outlining the roadmap.

The initiative focuses on solving structural challenges such as Malaysia’s RM101 billion ($21.5 billion) SME financing gap, where smaller firms often struggle to secure credit despite strong demand. Under one proposed model, large companies would issue tokenized invoice receivables that smaller suppliers could use as collateral or payment, accelerating cash flow and reducing settlement delays.

A second area of testing will explore tokenized sukuk and other Islamic finance instruments, using smart contracts to automate payments while remaining Shariah-compliant. The roadmap also includes pilots for ESG-linked assets, where payouts would be tied to verifiable environmental metrics to prevent greenwashing.

The central bank said tokenization projects will be assessed against three criteria: measurable real-world benefit, a clear advantage over traditional systems, and technical feasibility using current infrastructure. Pilot projects are expected in 2026, followed by wider trials in 2027. An industry working group co-led with the Securities Commission will oversee development and regulatory coordination.

Malaysia joins a growing group of Asian regulators testing tokenized finance, including Singapore’s "Project Guardian" and Hong Kong’s "Project Ensemble". However, Bank Negara Malaysia reiterated that cryptocurrencies remain outside the scope of the initiative and are not recognized as legal tender due to volatility risks.

Only licensed financial institutions will be allowed to participate in pilots, with early testing restricted to familiar assets such as deposits, loans and bonds, before expanding into more complex instruments. The central bank is accepting feedback on its tokenization paper until March 1, 2026.

If the roadmap advances as planned, tokenized financial products could begin rolling out across Malaysia’s regulated markets from 2027 onward.

Saudi Arabia has opened subscriptions for its November issuance of the government-backed “Sah” savings sukuk, offering investors an annual return of 4.71%, slightly lower than the 4.83% rate set in October, the National Debt Management Center (NDMC) announced.

The subscription window runs until 3 p.m. on November 4, according to an NDMC statement posted on X. The sukuk is part of the government’s 2025 issuance calendar and forms a key component of wider efforts to expand savings and deepen retail participation in the domestic debt market.

The one-year sukuk offers fixed returns paid at maturity, with a minimum subscription of 1,000 Saudi riyals ($266) and a maximum of 200,000 Saudi riyals per investor. Subscriptions are open to Saudi nationals aged 18 and over through approved digital investment platforms, including SNB Capital, Aljazira Capital, Alinma Investment, SAB Invest, and Al-Rajhi Capital.

The Sah program was launched under Vision 2030, which aims to increase Saudi Arabia’s household savings rate from about 6% to 10% by 2030.

The initiative comes as sukuk continues to represent a growing share of the Kingdom’s funding strategy. In October, the NDMC raised 7.54 billion Saudi riyals ($2.01 billion) through its regular riyal-denominated sukuk program, issued across four tranches with maturities between 2029 and 2039.

Saudi Arabia remains the GCC’s most active issuer in the fixed-income market. According to the Kuwait Financial Centre (Markaz), the Kingdom raised $20.32 billion through 36 debt issuances in the third quarter of 2025, representing a 62.7% year-on-year increase.

S&P Global has previously noted that steady sukuk issuance, combined with growth in the non-oil economy, is expected to support the continued expansion of the global Islamic finance sector.

Global fintech platform Fasset has received regulatory approval from Malaysia’s Labuan Financial Services Authority (FSA) to offer digital banking services, marking a major step in its transition from a digital asset platform to a full-service, Shariah-compliant financial institution.

The approval allows Fasset to operate within Malaysia’s regulated sandbox for Islamic fintech innovations, enabling it to offer deposit-taking, lending, and investment services powered by stablecoin infrastructure. The company’s new model positions it as the world’s first stablecoin-backed Islamic digital bank, serving a global user base of over 500,000.

The license expands Fasset’s operations beyond digital asset investing into on-chain, asset-backed banking. Users will be able to access zero-interest banking products alongside investments in U.S. stocks, gold, and cryptocurrencies through the company’s all-in-one financial superapp.

Founded in 2019, Fasset serves both retail and institutional clients across 125 countries, recording $6 billion in annualized transaction volume, a figure projected to reach $24 billion by 2026.

The new approval builds on Malaysia’s ambition to position itself as a regional hub for Islamic fintech. It also strengthens Fasset’s goal of addressing the lack of access to Shariah-compliant financial products across regions where traditional banking remains limited, such as Asia and Africa.

Fasset’s upcoming offerings will include asset-backed savings products, instant cross-border payments, and a crypto debit card that can be used globally through Visa, Google Pay, and Apple Pay. The company also plans to launch Own, an Ethereum Layer 2 network built on Arbitrum to facilitate settlement of real-world assets from regulated institutions.

Fasset’s expansion comes as the global Islamic finance industry surpasses $5 trillion in assets, with projections suggesting it could double by 2030, underscoring growing demand for modern, faith-aligned financial solutions.