BNM To Issue Policy Document To Broaden Takaful Industry

KUALA LUMPUR, Oct 30 (Bernama) -- Bank Negara Malaysia (BNM) plans to issue a policy document on the broader application of ta`awun (mutual assistance) in takaful by the end of this year, outlining shariah and regulatory requirements to unlock the full potential of the industry in fostering financial resilience and inclusion.

In a statement today, BNM said the upcoming policy framework aligns with maqasid shariah objectives.

The initiative was among the key outcomes of the Oct 15 Sixth Centralised Shariah Authorities Forum (CSAF) BNM hosted in Kuala Lumpur. 

The forum served as a key platform to exchange insights and enhance cross-jurisdiction collaboration in advancing Islamic finance.

BNM Shariah Advisory Council chairman Datuk Prof Dr Ashraf Md Hashim chaired the meeting, which gathered more than 50 delegates from 10 countries, as well as international Islamic standard-setting bodies. 

The central bank said authorities from participating countries shared their experiences in advancing Islamic finance, including efforts to transition from conventional banking, aligning Islamic finance with national development goals, and applying social finance tools to support communities. 

"These diverse approaches, shaped by local contexts, enriched the shared understanding and progress of the global Islamic finance landscape," it said.

The meeting also discussed recent legal reforms that recognise the takaful fund as a separate legal entity, noting that the Central Bank of the United Arab Emirates plans to strengthen the takaful fund’s governance framework to ensure transparency, accountability, and shariah compliance. 

On emerging instruments such as central bank digital currencies, the meeting discussed the fundamentals of modern money and its exploratory shariah implications based on a foundational research paper BNM published.

BNM said the meeting accepted the terms of reference for the CSAF platform, marking a significant step in strengthening the governance structure, clarifying roles and responsibilities and enhancing coordination among member authorities to achieve shared strategic objectives.

-- BERNAMA