Those people in Islamic finance who thought that the Internet had changed business radically back in 2010 must be feeling rather breathless right now as the next wave of disruptive businesses move rapidly into profit.
These are businesses that no one had thought of just a few years ago and yet now they are part of the fabric of business and social life. Prime examples of such businesses include Uber (‘Everyday cars for everyday use. Better, faster, and cheaper than a taxi’), Airbnb (‘Rent unique places to stay from local hosts in 190+ countries’), Quartz (‘A digitally native news outlet for the new global economy’), Stitcher (‘Radio that instantly connects you to any conversation’), Instacart (‘Groceries Delivered in an Hour’), Handy (‘Book expert home cleaners and handymen at a moment's notice’), Task Rabbit (‘Help around the home is just a few clicks away’) and Upwork (‘Find freelancers to tackle any job, any size, any time’).
What becomes clear is that the change the business world saw with the launch of Facebook, Amazon and eBay was just the beginning. We haven’t even really started yet. The revolution has just begun.
Naturally enough the finance industry is also grappling with this level of continued seismic change. Savvy banks are trying to predict where their businesses will be most vulnerable in the months and years ahead and are adapting now. Prime examples are not hard to find.
HSBC continues to roll up its carpet of being the world’s local bank, exiting marginal markets and chopping headcount. Just a few weeks ago the bank announced the sale of its Brazilian operations. It was always going to be hard graft trying to become a bank with a dominant retail presence but that goal becomes just about impossible to achieve when the biggest competitor to banks in the future is going to be supermarkets. Supermarkets have masses of retail space and, through their customer loyalty cards, know more about customers and their spending habits than anyone else. Banks may not be able to compete for long.
Other banks are adapting to native content as a way of communicating with their audiences. One of the most impressive forays into native content by a bank comes from Australia’s ANZ with its portal called BlueNotes (https://bluenotes.anz.com). I undertook a recent exercise to see how far Islamic banks had adapted to the use of native content and the results were not encouraging. Few, if any, Islamic banks seem to be using native content in the way that many leading western banks are.
The reality is that Islamic banks will only truly see the value in new innovations like native content when their marketing staffs are committed users and consumers of native content themselves. To put it bluntly, this is an age issue. ‘Old’ marketing managers, aged 35 and above, may not see the need to adapt. And the young ones who do see the value cannot find jobs in the Islamic finance industry. It is a classic vicious circle.
Ironically, the Islamic finance industry is a far newer industry than its conventional counterpart and so should be more open to change and development. Its employees should be more open minded, less bogged down in tradition and more amenable to change.
It is not all doom and gloom, however, since there are entrepreneurs out there who can see a meaningful place for new technology in the Islamic finance space. One example of such a business is Executive Muslim (www.executivemuslim.com) that pitches itself as being part LinkedIn, part Gumtree and part dating website. It is, in fact, a one-stop-shop for professional Muslims who have the same demands and the same time constraints as other professionals.
Headquartered in Glasgow, Scotland, Executive Muslim is headed up by Saleem Yousuf, who views the business as a necessary development for the Islamic finance and business arena. Executive Muslim’s head of global strategy, Adam Wurf says, “Executive Muslim is the only global online platform dedicated to enabling Muslim professionals to connect, interact and do business together.” Wurf is very bullish about the future of the business, “This could become not only the global hub for the Islamic finance industry, but a powerful way to connect to customers.”
It seems likely that there will be a wave of new startups aimed at the Muslim audience in the financial services arena, bearing in mind the fact that Islam is the world’s fastest growing religion and therefore the fastest growing consumer base. So how does Executive Muslim use technology to ensure that the business remains cutting edge? Wurf has a ready answer. “We are a tech company, so it is part of everything we do. Executive Muslim has an exciting roadmap of improvements, new features and new services to make doing business easier for Muslim professionals.”
It is not difficult to see that the growth potential for such a business is limited only by the growth in its subscriber numbers. “Our initial network is white collar and largely middle to senior executives. Naturally we are also seeing interest from graduates entering work,” says Wurf.
This latter point could be crucial to the development of Executive Muslim and all other business startups focused on Islamic finance. It has been well documented over recent years that there still seems to be a considerable mismatch between the volume and quality of new graduates wishing to work in Islamic finance and the number of job openings available to them. Any business that addresses this issue seems likely to find a ready audience and there are untold numbers of keen and freshly qualified young workers very keen on entering the Islamic finance workspace.
As banks and Takaful companies improve their own bottom lines through the smarter application of technology, a resultant increase in staff numbers can be hoped for. Geographically the area most likely to represent the richest pickings for Islamic finance job openings should be Africa and it seems probable that young hopefuls in both the Gulf and Asia would do worse than spending some time researching the opportunities in Africa. It could be a case of becoming a big fish in a small pond, safe in the knowledge that the pond is growing at a fast clip. It is also the place where tomorrow’s industry leaders will be trained tested and everyone serious about surviving in Islamic finance should take it very seriously indeed.