The global Islamic finance industry is on a steady trajectory towards significant expansion, with total assets projected to surpass the $10.5 trillion threshold by the year 2030.

This strategic projection was unveiled on Thursday at the Kuala Lumpur Islamic Finance Forum (KLIFF) in Malaysia, following the official announcement of the 2026 edition of the Islamic Finance Development Report.

The comprehensive report was jointly published by LSEG in collaboration with the Islamic Corporation for the Development of the Private Sector (ICD) – the private sector arm of the Islamic Development Bank (IsDB) Group.

The detailed findings highlight that the global Islamic finance ecosystem maintained a remarkably strong growth momentum throughout 2025, recording a nine per cent year-on-year increase as total assets hit $6.5 trillion.

“The global Islamic finance industry maintained a strong growth trajectory in 2025, with total assets reaching $5.5 trillion, up nine per cent year-on-year. Growth was supported by the continued expansion in Islamic banking, record sukuk issuance, strong Islamic fund performance and new regulatory frameworks.”

According to the report, Malaysia, Saudi Arabia, the United Arab Emirates, Indonesia and Pakistan retained their positions as the world’s most developed Islamic finance markets.

“These countries continued to benefit from comprehensive regulation, strong institutional development, active financial markets and well-established knowledge ecosystems,” it stated.

Beyond the core hubs, notable growth gains were recorded across several emerging jurisdictions, including Türkiye, Tanzania, Kenya, Benin, Azerbaijan and Uzbekistan, signalling broadening geographical traction.

The report outlines critical structural shifts driving sector progression worldwide, particularly across Africa and Central Asia:

“Regulatory reforms and stronger market infrastructure are supporting growth beyond core markets, particularly across Africa and Central Asia. Sustainability guidelines are increasingly prioritised, although activity remains concentrated in developed markets. Digitalisation is also advancing, with FinTech, open banking and tokenised sukuk influencing financing, issuance and settlement while widening access to financial products. However, talent development is lagging industry expansion, emphasising the need for stronger specialist education.”

Commenting on the development, the Acting Chief Executive Officer of ICD, Khalid Khalafalla, said: “For ICD, these developments reinforce the importance of ensuring that Islamic finance serves as a practical instrument for inclusive and sustainable economic transformation. ICD remains committed to advancing private-sector development across its member countries through targeted financing and the promotion of Islamic financial solutions.”

Head of Islamic Finance at LSEG, Mustafa Adil, noted: “Looking ahead, global Islamic finance assets are projected to exceed $10.5 trillion by 2030, supported by continued Islamic banking expansion, growing sukuk issuance momentum, emerging-market adoption and demand for sustainable and digital financial solutions.”

The report draws on the Islamic Finance Development Indicator (IFDI), a global benchmark that assesses the development of the Islamic finance industry across 140 countries through five key areas: financial performance, governance, sustainability, awareness, and knowledge.