Qatar’s Islamic finance sector has become an increasingly important component of the country’s broader financial system, supported by the expansion of sharia-compliant banking, takaful (Islamic insurance) and sukuk (Islamic bonds) issuance. The sector benefits from a well-established regulatory framework and strong institutional participation, helping position Qatar as a key player in regional Islamic finance markets. Amid the ongoing conflict and heightened geopolitical uncertainty, these foundations are supporting stability and continued activity across the sector. Qatar’s sharia-compliant industries are poised to gain from the resumption of government-led development initiatives, supporting both domestic growth and continued integration into global Islamic banking markets.
Qatar’s authorities have prioritised the Islamic finance segment for increased sophistication and depth in the years ahead, seeing its evolution as a key pillar of their long-term diversification goals. Meanwhile, the regulatory framework surrounding the sector, along with digitalisation and Islamic financial technology (fintech) – increasingly enhanced by artificial intelligence (AI) – are strengthening its competitiveness and boosting its efficiency.
The results of all this have been visible in recent years, with Islamic finance representing some 27% of Qatar’s total financial assets in 2024, at QR694bn ($190.5bn). That was the result of a compound annual growth rate (CAGR) of 6.4% over the 2020-24 period – over a percentage point above the overall financial sector CAGR of 5.3%. Banking, takaful and sukuk have all seen growth over the period, with 2025 and 2026 seeing that trend continue.
Oversight
All of the country’s lenders, insurers and other financial institutions – both conventional and Islamic – come under the supervision and regulation of the Qatar Central Bank (QCB). Established in 1993, the QCB took over from the Qatar Monetary Authority (QMA), set up 20 years earlier to manage the newly-established currency, the Qatari riyal. The QCB is headed by its board of directors, chaired by Sheikh Bandar bin Mohammed bin Saoud Al Thani as of May 2026. The board includes the undersecretaries of the Ministry of Finance (MoF) and Ministry of Commerce and Industry (MoCI), as well as the QCB deputy governor, Sheikh Ahmed bin Khalid bin Ahmed bin Sultan Al Thani.
Structure
The QCB consists of a number of branches, with the Supervision Sector responsible for banking, insurance, fintech and other types of supervision of financial institutions, as well as oversight of financial crime and compliance. The QCB also issues licenses for all lenders operating in the country. These responsibilities cover both conventional and Islamic entities. In addition, sharia-compliant financial service providers that have listed equities on the Qatar Stock Exchange (QSE), issue sukuk on the exchange’s fixed income market, or participate in its exchange traded funds (ETFs) are also subject to the supervision and regulation of the Qatar Financial Markets Authority (QFMA).
Qatar has an onshore financial free zone, the Qatar Financial Centre (QFC), which is regulated by the QFC Regulatory Authority (QFCRA), an independent regulator. The QFCRA operates according to a regulatory framework based on English commercial law, with its own procedures for company registration and commercial courts. All of its procedures also allow for and consider sharia-compliant banks. In addition, the QFCRA is an associate member of the international standards-setting Islamic Financial Services Board (IFSB). Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) standards have also been compulsory for Islamic lenders in Qatar since 2017.
AAOIFI standards are continuously being updated and refined, with a recent new draft, Standard 62, which concerns sukuk structures, expected for release in 2026. The new standard seeks to switch from an unsecured form of financing to securitisation, a process which had been causing some concern in jurisdictions where assets may not always be transferred easily. In Qatar, for example, changes to real estate laws might be required to enable such a transference. More work is therefore likely to be done on Standard 62 during 2026 before the new regulation comes into practice. At the same time, since 2014 all banks in Qatar – Islamic or conventional – have been required to observe the Basel III framework for minimum capital adequacy. The minimum capital adequacy ratio (CAR) – and aggregate of Tier 1 and Tier 2 capital – must be at least 12.5%, with at least 10.5% of Tier 1 capital.
Regarding takaful and the insurance sector more broadly, in 2019 the QCB introduced a decree setting out guidelines for the licensing, regulation and supervision of insurance and takaful intermediaries and service providers. The same year, the QCB also launched its Insurance Sector Cybersecurity Regulation, setting out obligatory standards in cybersecurity for insurance and takaful operators. In August 2023 the central bank then issued a regulation covering insurance price comparison websites, which it then followed in April 2024 with its Digital Insurer Regulation. This established guidelines for insurers and takaful outlets operating in the digital space, forming part of an broader effort to establish clear rules and guidelines for the segment (see analysis).
For its part, in 2023 the QFCRA issued its Insurance Business Amendment Rules to streamline and enhance governance and regulation of insurance and takaful companies registered at the QFC. In addition, in 2024 the QCB and the QFCRA issued their Sharia Governance Framework. This mandates sharia governance for all Islamic lenders operating in the country. The framework requires banks, takaful companies and other Islamic financial institutions to establish sharia supervision boards, conduct periodic audits to ensure continuing adherence to sharia regulations and to implement sharia-compliant product development. The audit and implementation process is increasingly digitalised, as the QCB and QFCRA pursue their long-term digitalisation strategies, enabling Islamic fintech development, as well as more robust supervision.
The growing need for sophisticated sharia compliance has helped develop Qatar’s Islamic accountancy and consultancy businesses, with providers such as Bait Al Mashura in the field, along with international companies, such as Deloitte and Baker McKenzie. Companies operating in Qatar must also obtain the relevant business licenses from the MoCI and, if based outside the QFC, comply with all the relevant tax and financial requirements set down by the MoF.
Plans & Programmes
The outbreak of conflict in the region at the end of February 2026 impacted the delivery of Qatar’s economic and financial development strategies. Nonetheless, the government has substantial financial reserves and an established shock fund to support the economy. As of May 2026, while the course of the conflict was still uncertain, Qatar’s Islamic financial sector looked set to continue to receive strong government support, while the government’s longer-term course of development remained unchanged.
Strategy
The country’s long term course has been crystallised in Qatar National Vision (QNV) 2030 – the government’s long-term development plan. Implemented in stages, QNV 2030 is now in its final stage, the Third National Development Strategy (NDS-3) for the 2024-30 period. Central to these plans is economic diversification – seen as the pathway to sustainable long-term growth for an economy that has historically relied heavily on hydrocarbons exports, particularly those of liquefied natural gas (LNG). The NDS-3 is divided into a series of diversification clusters that are set to receive special attention by the government. Among them, financial services have been designated an enabling cluster, referring to the sector’s role in enabling economic growth across the board by boosting liquidity.
To realise this, in November 2023 the QFMA launched its Third Financial Sector Strategic Strategy (FSS-3). Setting the target of a 4.7% CAGR over the 2023-30 period, the economic development roadmap is supported by four main pillars, with five themes horizontally cross-cutting these four verticals. They are: governance and regulatory oversight; digital innovation and advanced technologies; talent and capabilities; environmental, social and governance (ESG) and sustainability; and Islamic finance. This means that sharia-compliant finance is seen as a field for development in all of the four pillars of the plan – banking, insurance, the digital finance ecosystem and capital markets.
The FSS-3 therefore sets goals in each of these areas of Islamic finance, from developing new sukuk issuances and diversifying and expanding the range of sharia-compliant financial instruments to increasing the volume of Islamic banking assets, and from setting a robust regulatory framework for digital Islamic finance to providing a full range of takaful and family takaful (life insurance) products.
Market Players
Islamic banking was responsible for some 84% of the country’s sharia-compliant financial assets in 2024, making it by far the largest part of the government’s Islamic financial sector. In recent years, growth has been driven by credit to the private sector, which made up 78% of Qatar’s Islamic banking collective finance portfolio in 2024.
As of May 2026 Qatar had four listed sharia-compliant banks: Qatar Islamic Bank (QIB), Qatar International Islamic Bank (QIIB), AlRayan Bank and the investment lender Lesha Bank. Lesha Bank, along with two non-QSE-listed sharia-compliant banks, QInvest and Abu Dhabi Islamic Bank, operate from the QFC. A further investment bank of note in the sharia-compliant space is the Qatar Development Bank (QDB). This is government-owned and has a central mission of supporting and developing the Qatari private sector. In 2010 it began transitioning to a fully Islamic model, a goal largely achieved by 2019, when approximately 97% of its assets were declared fully sharia compliant.
In terms of free-float market capitalisation, QIB was the largest of the domestic Islamic banks, with QR45.7bn ($12.5bn) as of December 2025. This made it the country’s second-largest bank, after Qatar National Bank (QNB), with QIB responsible for around 23% of Qatar’s listed banking sector market capitalisation. Qatar’s second-largest lender as of December 2025 was the overall sector’s third-largest bank, AlRayan Bank, with market capitalisation of QR15.1bn ($4.1bn), or around 7.7% of the overall banking sector total, while QIIB was the third-largest sharia-compliant organisation and fourth-largest lender overall, with market capitalisation at QR13.9bn ($3.8bn), or around 7% of the banking sector total. Lesha Bank, meanwhile, had a market capitalisation at QR868m ($238m).
This illustrates the importance of Islamic banking in Qatar, as three of the country’s top four banks were sharia compliant. Added together, the four sharia-compliant institutions accounted for approximately 38% of total banking sector market capitalisation in December 2025 – a testimony to significant expansion in recent years. Indeed, the Islamic banking sector’s total assets stood at QR451bn ($123.8bn) in 2020, surging to QR585bn ($160.6bn) in 2024. In July 2025 international ratings agency Fitch reported these banks accounting for some 25% of total banking assets in Qatar. According to the international IFSB, the government’s Islamic banks demonstrated a CAGR in asset growth of 7.9% between 2019 and the third quarter of 2024, while QFC put the CAGR for the 2020-24 period at 6.8%, more than two percentage points higher than the 4.5% CAGR recorded by the banking sector overall.
Sector Growth
This performance is underpinned by strong fundamentals. QIB saw its net profit attributable to shareholders grow 5% in 2025, from QR4.6bn ($1.26bn) to QR4.8bn ($1.32), with asset growth of 10.1% over the same period. Customer deposits expanded by 14.2% between December 2024 and December 2025, helping the bank achieve a financing-to-deposit ratio of 90% – just under the QCB’s maximum requirement of 100% and demonstrating a strong liquidity position. QIB has also worked hard to bring down its non-performing financing ratio, which declined from 1.9% at the close of 2024 to 1.7% at the end of 2025.
AlRayan Bank saw its net profits rise 1.5% in 2025, while total assets grew 5.9% over the same period. Customers’ deposits were up 3.3% between the end of 2024 and the end of 2025, to QR111.1bn ($30.5bn), with the bank’s CAR standing at 25.5% – more than twice the QCB requirement of 12.5%. AlRayan Bank’s non-performing financing ratio fell from 5.5% at the end of 2024 to 5.1% at the end of 2025. The bank made a notable effort to improve efficiency, with disciplined cost management providing AlRayan Bank with a cost-to-income ratio of 29.3% – up from 27.1% the year before.
QIIB, meanwhile, announced in January 2026 that its net profit jumped 7.2%, while total assets expanded by 4.4% to QR62.6bn ($17.2bn). Customer deposits were up over the same period, by 4.6%, and the bank’s CAR ended 2025 at 20.1%. In terms of efficiency, QIIB’s cost-to-income ratio stood at 18.6% at the end of 2025, while its non-performing financing ratio was 2.9% and its coverage ratio 100%. The year 2025 was key for QIIB in that it marked the bank’s first sukuk listing on the QSE – a QR500m ($137.2m) issuance that was the exchange’s first corporate Islamic sukuk.
Lesha Bank demonstrated a strong performance in 2025, with its annual net profit standing at QR200.1m ($54.9m) – 56% growth at the close of the year. As an investment financial service provider, Lesha Bank’s assets under management also expanded by 54%, to reach QR13.3bn ($3.7bn).
Takaful Players
Qatar’s Islamic insurance sector consists of five independent takaful companies: the Qatar Islamic Insurance Company (QIIC), Al Khaleej Takaful Insurance Company (AKTI), Damaan Islamic Insurance (Beema), the General Takaful Company – the Islamic window of Qatar General Insurance and Reinsurance Company (QGIRC) – and Doha Islamic Insurance – Shamel, a subsidiary of Doha Insurance Group, which was trading as Doha Takaful Company until a rebranding in May 2025.
QIIC was the largest Qatari takaful company and the second-largest company overall on the QSE’s insurance and takaful board in December 2025, with market capitalisation at QR1.3bn ($356.8m). At the same time, AKTI had market capitalisation of QR541.6m ($148.7m), and Beema had market capitalisation of QR206.4m ($56.7m). The two insurance and takaful groups, Doha Insurance Group and QGIRC, had market capitalisation rates of QR1.2bn ($329.4m) and QR1.1bn ($301.9), respectively.
Overall, Qatar’s takaful entities were responsible for some 14% of the country’s total gross written premium in 2024. Total revenue in the first six months of 2025 for the takaful segment was QR800m ($219.6m) – up from QR700m ($192.1m) in the first half of 2024 – compared to QR6.1bn ($1.7bn) among conventional insurers for the first six months of 2025 – a figure roughly unchanged from the first half of 2024. Indeed, within Qatar’s overall insurance and takaful industry, much of the recent momentum has been within the sharia-compliant market. Results for the first six months of 2025 show 10% revenue growth, year-on-year, for the takaful segment, while conventional insurers saw a more modest 1% growth. In terms of profitability, takaful companies recorded 42% growth between the first six months of 2024 and the same period of 2025, while conventional insurers recorded 10%.
Strong growth was also recorded among Qatar’s leading takaful companies in 2025. QIIC reported record profits – up 10% in 2025, with its gross written premium up 9% to QR791m ($217.1m). This profit expansion was reportedly driven largely by personal lines, health and property. Meanwhile, Beema reported its net profit for 2025 up 12.9%, from QR84.6m ($23.2m) to QR95.6m ($26.2m).
Beema’s largest line of business is takaful and health, which contributed 49% of the company’s total recognised takaful contributions in FY 2025, with motor and marine taking up 28% and fire and general accident 23%. With its group life, medical and credit takaful crucial, Beema has demonstrated strong investment income growth in recent years, with this rising from QR24m (6.6m) to QR49m ($13.4m) over the FY 2022/25 period. Indeed, medical and health insurance have been growth areas in Qatar in recent years, with 2022 seeing the introduction of mandatory health insurance for all expatriate residents and visitors. Those non-Qataris working in the country must have private health insurance provided by their employers, while tourists are obliged to take out travel insurance to cover them during their stay in Qatar. At the same time, Al Khaleej Takaful Insurance Company witnessed a slight contraction in its net profits in 2025, of 4.2%. The company’s total assets grew by nearly 2.4% over the year, while recognised takaful contributions also grew, by 19.7%. Recognised takaful and re-takaful costs, however, also increased, by around 17% and 39%, impacting eventual profit.
Capital Markets
Qatar’s fixed-income market has been growing steadily in recent years, with issuances of government and corporate bonds and sukuk both beginning to establish the QSE as a significant regional and international player. Following the recent regional conflict-, the market remained dominated by government issuances, with 33 government sukuk listed as of late February 2026.
This was slightly under the 34 government bonds on the QSE fixed-income market. Additionally, there were two corporate sukuk tenders – the QR500m ($137.2m) QIIB issuance and a QR500m ($137.2m) offering from AlRayan Bank, compared to three conventional corporate bonds. Both sukuk are landmarks – the QIIB issuance for being the first corporate sukuk listed on the QSE, while AlRayan Bank’s issuance in February 2026 was the first green sukuk issued on the exchange.
The Qatar Stock Exchange (QSE) is home to the QE Al Rayan Islamic Index – created in order to prepare the issuance of the Al Rayan Qatar ETF. The index consists only of those stocks listed on the QSE that are considered sharia compliant. As of early December 2025 the QE Al Rayan had 21 companies listed, with banking and financial services outfits predominating. These accounted for 34.5% at the time, followed by industrials (30.5%), telecommunications (12.5%), real estate (10.5%), consumer goods and services (6.5%), transport (5%), and insurance (0.5%).
Outlook
While the IMF’s February 2026 Article IV Mission to Qatar anticipated 4% real GDP growth in the medium term, the outbreak of the Iran conflict that same month led to some shorter-term revisions. Nonetheless, backed by a strong financial sector, non-hydrocarbons resilience and LNG production expansion, longer-term forecasts remain generally positive for the sector.
In the sharia-compliant space, recent higher-than-average growth rates for Islamic financial service providers and takaful organisations are being backed by continued high demand for sukuk – both corporate and government. This has remained robust despite the conflict, given the continuing requirements for sharia-compliant capital among Islamic financial institutions worldwide. Meanwhile, innovations in digital Islamic financial services are helping boost efficiencies, diversify product offerings and bring Islamic financial options to an ever-wider audience. Against this backdrop, Islamic finance in Qatar is poised for robust development.
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