Saudi Arabia, the UAE and Malaysia are emerging as leading centres in Islamic fintech as global transaction volumes are projected to reach $341bn by 2029, according to a new industry report highlighting accelerating growth in Shariah-compliant digital finance.
The Global Islamic Fintech Report 2025/26, produced by DinarStandard and Elipses, estimates transaction volumes at $198bn in 2024/25, with annual growth of 11.5 per cent through 2029, marginally above the broader fintech sector’s projected 11 per cent rate. Under the Global Islamic Fintech Index, which assesses talent, regulation, infrastructure, market maturity and capital availability, Saudi Arabia, Malaysia and the UAE rank among the most conducive ecosystems. Gulf Cooperation Council economies are described as intensifying efforts to position the region as a hub for Shariah-compliant financial technology.
The sector now comprises 484 firms worldwide, with 30 identified as notable players based on innovation, funding and geographic expansion. Saudi Arabia, Iran, Malaysia and the UAE rank among the top 10 markets by transaction volume, alongside Indonesia, Kuwait, Turkiye, Bangladesh, Pakistan and Qatar. Industry participants cite access to capital, regulatory compliance, limited customer education and high acquisition costs as key constraints.
Digital assets are identified as a significant growth frontier. Stablecoins had a combined market capitalisation of approximately $317bn in early 2026, while tokenised real-world assets stood at about $4.31bn. The report highlights increasing focus on stablecoins and central bank digital currencies for settlement, and on tokenisation for distributing real-world assets within Shariah governance frameworks. Fitch estimates outstanding sukuk surpassed $1tn in the third quarter of 2025, suggesting that even migrating 1 to 5 per cent of issuance on-chain could represent $9bn to $45bn in assets.
Regulatory initiatives are advancing in parallel. Abu Dhabi’s FIDA cluster aims to build institutional-grade digital asset infrastructure under supervision, while the UAE has launched its Digital Dirham initiative and Malaysia has published a discussion paper on asset tokenisation. The report concludes that sustained growth will depend on embedding Shariah oversight into operational systems, strengthening legal enforceability of tokenised ownership and aligning compliance with scalable distribution models.
