Islamic finance may have shunned the reckless behaviour that nearly brought down the mainstream financial system last year, but it is not able to step in to the old regime's shoes.
Some expect the industry to grow by double digits in the next three years -- the secretary general of a top standard setting organisation for Islamic finance agrees and with humour:
"We Muslim breed and breed well", he said laying down his expectations for future demand of Islamic products.
Jokes aside, Mohamad Alchaar , secretary general of AAOIFI, delivered a message today in London. There is "absolutely no way" that Islamic finance could replace conventional banking in spite of growth potential. Given that a financial product depends on scholars' approval and scholars tend to disagree about what complies with Islamic law, Dr. Alchaar may have a point.
"The fact that the system broke down does not make us better. We have plenty to offer to raise on our own rather than on the demise of others," he said at a briefing organised by accounting company BDO.
One thing Islamic finance can do: it can fight extremism, he reckons.
By helping develop an industry that can give devout Muslims access to banking, financing and investments and a chance to improve their financial lot, the world is giving them a reason to ignore extremism.