Islamic Banking Assets To Hit $7.5tn By 2028 As Global Demand Surges

Despite this growth, 65 per cent of corporates interested in Shariah-compliant solutions reported having no prior exposure to Islamic banking, highlighting a major gap between rising demand and practical familiarity.

The report identifies this knowledge shortfall as a key factor preventing corporates from accessing an estimated $5.5tn in global Islamic finance assets — a market expected to reach $7.5tn by 2028.

Corporate participation

The number of corporate Sukuk issuers has nearly doubled since 2020, driving a 38 per cent increase in issuance volumes to $58.8bn in 2024.

Khurram Hilal, CEO of Group Islamic Banking at Standard Chartered, said: “Islamic banking has evolved into one of the world’s fastest-growing sources of capital, but awareness amongst corporates has not kept pace.

“Corporates that build Islamic finance capabilities stand to access specialised capital pools with trillions in assets, preferential pricing in oversubscribed markets, government incentives in high-growth markets, and ESG-focused capital pools where ethical screening is structurally embedded.

“This knowledge gap reflects an increasingly expensive opportunity cost.”

ESG alignment and digital innovation

The report notes that Islamic finance principles align closely with ESG frameworks, both prioritising transparency, fairness, and environmental responsibility.

Investors oversubscribed sustainable Sukuk by 4.3 times their issuance value in 2024, compared to 3.1 times for regular Sukuk, showing strong demand for instruments that meet both Shariah and sustainability criteria.

Emerging technologies such as tokenised Sukuk, blockchain-based settlements, and AI-enabled Shariah compliance tools are also reshaping the sector — lowering issuance costs, improving cross-border transparency, and enhancing training and governance models.

The report highlights Islamic banking’s growing role in financing the $5.7tn South–South trade corridor, linking the GCC, Southeast Asia, South Asia, and Africa — which now accounts for nearly one-quarter of global trade.

Halal economy

The Halal economy alone represents a $2.2tn opportunity, with corporates increasingly adopting Islamic trade finance and supply-chain solutions such as Standard Chartered Saadiq’s Halal360.

Standard Chartered, which operates the only global Islamic banking franchise across more than 30 markets, has arranged over $200bn in Islamic financing to date, spanning Sukuk, structured trade, and sustainable finance solutions.

Khurram Hilal added: “Islamic finance is now a strategic conversation in boardrooms. Our role is to bridge interest with expertise, helping global corporates deploy practical and cross-border Shariah-compliant banking solutions that support their business strategies.”