Global Islamic finance assets are projected to reach $10.5 trillion by the end of the decade. This marks a 61.5 percent increase from $6.5 trillion in 2025. The 2026 Islamic Finance Development Report, released by the Islamic Corporation for the Development of the Private Sector and the London Stock Exchange Group, forecasts average annual growth of 9 percent through 2030.
Malaysia took the top position in the Islamic Finance Development Indicator with a score of 136. Saudi Arabia followed with 113 and the United Arab Emirates with 95. Indonesia and Pakistan completed the top five. The global index score reached 12, reflecting improved performances across 140 covered countries.
Global sukuk issuance rose by 14.5 percent to a record $291.4 billion in 2025. Saudi Arabia emerged as the world’s largest market by outstanding value. Saudi Arabia and Malaysia jointly accounted for roughly two-thirds of global outstanding sukuk. African sovereign issuance reached $4.5 billion, up from $1.7 billion in 2021, and Benin secured orders exceeding $7 billion for a debut $500 million sukuk.
Khaled Ramadan, an economist and head of the International Center for Strategic Studies in Cairo, stated that Saudi Arabia’s market position could support broader economic diversification. He noted that sukuk can finance long-term infrastructure projects in renewable energy, transport, tourism, and industry to reduce oil revenue dependence. Ramadan also identified government support, rising demand, and digitalisation as primary growth drivers.
Global Islamic banking assets expanded by 8 percent in 2025 across 84 countries. In Bangladesh, asset growth slowed to 3 percent due to financial misconduct and governance failures, leading authorities to merge five institutions into Sammilito Islami Bank. Gulf Cooperation Council banks remained resilient against regional conflicts, backed by strong capitalisation and sovereign support.
Other Islamic financial institutions, including more than 1,200 financing companies, microfinance firms, and fintech businesses, recorded the fastest segment growth in 2025. Global takaful assets grew 9 percent to $146 billion across 54 countries. Islamic fund assets rose 22 percent to $375 billion, partly aided by United States equity performance.
Environmental, social, and governance sukuk issuance climbed 54 percent to a record $23.8 billion. Lenders in the United Arab Emirates issued sustainability-linked sukuk, and Malaysia onboarded 30 climate-related projects requiring more than 4 billion ringgit by January.
Ramadan cautioned that divergent regulatory and Shariah standards, limited secondary-market liquidity, high issuance costs, and shortages of specialised professionals could constrain future expansion.
