Islamic Financial Services
From The Report: Kuwait 2025
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The outlook for Kuwait’s Islamic financial sector is positive. Two banks, Kuwait Finance House and Warba Bank, have made acquisitions that will expand their reach domestically and lay the groundwork for expansion in other regional markets where Islamic banking is not as developed. The passage of Kuwait’s Public Debt Law in March 2025 will improve local banks’ liquidity and spur improvements in the local sukuk (Islamic bonds) market. Internationally, the growth of sukuk providers has been a boon for Kuwait’s Islamic banks, who have been bookrunners for significant amounts of issues in 2023 and 2024. Sectoral improvements, such as those carried out by the Insurance Regulatory Unit, and clarified guidelines for digital banks published by the Central Bank of Kuwait, are driving innovation and efficiency improvements. The insurance sector will see modest growth due to policies enacted in the early 2020s while growing competition may lead to consolidation.

This chapter contains an interview with Khaled Yousef Al Shamlan, Group CEO, Kuwait Finance House.

Articles from this Chapter

Overview

Laying the foundation: Institutional strength, cross-border activity and legislative reform underpin Kuwait’s sharia-compliant finance ambitions
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Kuwait’s Islamic financial sector has become increasingly dynamic since the end of the Covid-19 pandemic. Two banks, Kuwait Finance House (KFH) and Warba Bank, have made acquisitions that will expand their reach domestically and lay the groundwork for expansion in other regional markets where Islamic banking is not as developed as it is in Kuwait. The passage of Kuwait’s Public Debt Law in March 2025 will improve local banks’ liquidity and spur much needed improvements in the local sukuk (Islamic bonds) market. Internationally, the growth of sukuk providers has been a boon for Kuwait’s Islamic banks, who have been bookrunners for significant…

Interview

The next step: Khaled Yousef Al Shamlan, Group CEO, Kuwait Finance House, on fostering innovation and public-private collaboration
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Interview: Khaled Yousef Al Shamlan, Group CEO, Kuwait Finance House, on fostering innovation and public-private collaboration What strategic measures should Kuwaiti Islamic financial institutions take to further solidify their position amid rising regional and global competition? KHALED YOUSEF AL SHAMLAN: Kuwaiti Islamic financial institutions should pursue a multi-faceted strategy, exploring both organic and inorganic growth opportunities – whether by expanding existing institutions or converting…

Analysis

Long-term appeal: Increased competition among buy now/pay later providers with greater penetration in emerging markets
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Building on the momentum seen in the e-commerce space during the Covid-19 pandemic, the buy now/ pay later (BNPL) model is one of the fastest-growing segments in consumer finance, particularly in emerging markets. The global market is valued at an estimated $560bn in 2025, having achieved a compound annual growth rate (CAGR) of 21.7% between 2021-24. BNPL providers offer point-of-sale loans that consumers can repay in instalments over the course of weeks or months. Charging little to no interest, these microcredit providers make profit via transaction fees paid by the retailer, offering increased sales and customer conversion in return. Highlighting…