muhammad bin ibrahim : evolving the next frontier of islamic finance development through innovation speech by mr muhammad bin ibrahim, assistant governor of the central bank of malaysia, at the mock cheque exchange ceremony between the international centre for education in islamic finance ( inceif ) and bank islam, maybank islamic and affin islamic, kuala lumpur, 15 june 2010. * * * thank you for inviting me to witness the mock cheque exchange ceremony for the allocation of zakat contributions from bank islam, maybank islamic and affin islamic to the international centre for education in islamic finance ( inceif ). this act of giving signifies an exemplary commitment on the part of these islamic financial institutions to support human capital development in islamic finance. as a leading provider of advanced education in islamic finance, inceif plays an important role to position malaysia as a center for innovation and thought leadership in this field. but inceif alone would not be able to achieve this objective without the continuous efforts and support by all stakeholders within the industry. let me make a few remarks on innovation. few would argue on the role of innovation as the connerstone to sustaining growth and securing competitive advantage for any organization, industry, economy and nation. as we have seen in the more recent decades, innovation has fundamentally transformed the global financial landscape at a very rapid pace. innovation in the financial services industry has enabled financial institutions to obtain better insight into customer needs and correspondingly, develop new and better products to match their diverse needs, make significant improvements in operational efficiency by improving processes and business models as well as ensure more effective risk management. it has facilitated greater financial inclusion by allowing broader access to financial services in many emerging and developing countries. but the abilities to innovate will very much depend on the ability to get the necessary talent : the creativity to develop new ideas, the capacity to absorb knowledge and the capacity to acquire the new skill to turn ideas into results. this requires a talented workforce as the driving force of innovation. building such a workforce would thus become a constant challenge for the islamic financial services industry. in the context of islamic finance, human capital development is all the more important given that the islamic finance industry is still relatively in a nascent development phase. there is no doubt that the islamic financial services industry in malaysia has experienced an exciting and phenomenal growth. the proliferation of competitively priced islamic financial products to match the diverse and discerning needs of customers particularly in this recent decade is quite evident. but we cannot be compl

global players like large card networks or bigtech firms from china and the us. moreover, citizens and businesses should be able to send and receive cross - border payments to and from countries beyond the euro area under the same conditions and with the same ease as within as was highlighted this morning by bundesbank president jens weidmann. clearly, we need comprehensive european answers to the challenge posed by digitalisation while harnessing the benefits it offers. and these answers need to be inspired by a different mindset than before – just as einstein suggested. at the end of the day, it ’ s payees and payers who should ultimately benefit from being the focus of this mindset. as soon as possible, users should be able to send and receive payments throughout europe in a convenient and cost - efficient, safe and secure way. the underlying payment solution should be 1 / 3 bis central bankers'speeches recognisable as a common brand, enjoy european governance and seek global acceptance. the eurosystem took a first step towards making this vision a reality with its retail payments strategy. 1 today we learned more about the eurosystems ’ reasoning, ambitions and plans to foster payment system development in europe. the european commission recently picked up on this concept in its own retail payments strategy. 2 it is part of a comprehensive range of measures laid out in the so - called digital finance package. this morning it was further outlined by mairead mcguinness how this package will facilitate the digital transformation in financial markets. the bundesbank is fully supportive of these efforts, including during the german presidency. although some details merit further discussion, it became clear today that this package strikes just the right balance between reaping the benefits and mitigating the threats presented by the digitalisation of payments. olaf scholz, rightfully, emphasized the strong political will set on these topic. there ’ s just one point i would like to highlight : sepa instant payments are about to become the “ new normal ” in payments. a number of issues still need to be resolved, though. these include, first, pan - european reach – this is crucial for “ making it ” in the instant world. second, providers have to develop compelling solutions for end - users in all different payment situations : be they mobile, offline or online. ideally, these are seamlessly connected to a comprehensive range of relevant uses cases. introducing biometric authentication could further enhance attractiveness. third, matters of real - time