The Resilience of Islamic Finance Against Pandemic-Induced Future Economic Crisis

This study theoretically explores the level of resilience of the Islamic finance industry against economic distress triggered by the pandemic in order to identify products, institutions, and practices that may be introduced to future-proof the industry from unexpected pandemics in the near future. In doing this, the key questions this study seeks to answer include: How resilient is the Islamic finance industry against financial and economic distress? How can Islamic finance contribute to the long-term economic stability that allows countries to be able to cope with the uncertain consequences of the pandemic? What tools can the Islamic finance industry deploy to change the fortunes of emerging economies for the better as part of the post-COVID-19 economic recovery? Does Islamic social finance have any role to play in reducing the impact of the prolonged pandemic on the less privileged in society? Furthermore, what is the role of Islamic-driven FinTech in transforming modern economies? While adopting an analytical approach, the study finds that Islamic social finance remains an evergreen project that could be utilized to weather the storm of future pandemics. In addition, the study finds that beyond shariah compliance, which is certainly very important, Islamic financial products and services should also be conventionally viable and competitive.