Islamic finance at Sber 2020: Abu Dhabi office, USD13 mln export deal, and PayZakat victory
In 2020, Sberbank has seen growth in the main Islamic finance areas and marketed several new products. Here are the highlights:
1. USD13 mln deal to export Russian wheat to Egypt
For the first time, a trade finance deal for the export of Russian wheat to Egypt was carried out at Sberbank with the participation of the International Islamic Trade Finance Company.
2. Abu Dhabi office
Sberbank has received regulatory approval in Russia and the UAE to register a subsidiary called Sberinvest Middle East Limited. A set of documents to approve its corporate structure and staff composition has been prepared. The company is set to become a licensed Islamic window, which will structure investment products aligning them with the principles of Shariah, work on traditional Islamic finance products, build direct partnerships with Far Eastern investors and develop the exportation of Russian food.
3. Setting up partner financing center and special projects
The underlying idea behind this is the bank’s entry into the financed project on partnership terms with the division of possible risks and subsequent profits. The pipeline of such projects includes large deals; by the end of the year, their number has doubled. In 2021, the pipeline of Islamic banking projects also includes inclusive products specifically structured to meet the needs of the population in the regions.
4. PayZakat charity platform wins Global Islamic Finance Awards and sees the number of subscribers grow to 4,000
PayZakat allows you to transfer and distribute compulsory (zakat) and voluntary contributions (Sadaqah) for the benefit of poor and needy Muslims. During the first full year of operation, as many as 651 payments with a total worth overshooting RUB4 mn have been processed. Organic followers are up 101%. To increase the number of subscribers and accessibility, PayZakat has launched an application on Google Play, with an iOS app coming soon. The uniqueness and innovativeness of the PayZakat service have been recognized internationally as the platform won the first prize in the Social Finance category of the Global Islamic Finance Awards (GIFA). The jury highly appreciated the platform’s technology, which makes charity as transparent as possible and allows tracking every payment from a philanthropist to the final recipient. The jury also noted the quick marketing of PayZakat’s first pilot product and its integration into the Sberbank ecosystem.
5. Islamic finance lectures for students
Sberbank has held them with the MGIMO School of Business to make Islamic banking more popular.
Islamic finance is one of the most promising areas of the global economy, and we are glad that Sberbank is Russia’s first company that started developing this business and has achieved significant success in such a short time. We are set to keep working on our current services in 2021, market new products, and announce deals
Senior Vice President, Sberbank