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Islamic Finance Technology

Published by Gbaf News

Posted on January 29, 2014

8 min read

Last updated: January 22, 2026

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Path Solutions provides the industry’s widest range of software solutions to Islamic banks and Islamic financial institutions. Mohammed Kateeb, Group Chairman & CEO of Path Solutions, answers our questions about Islamic Finance Technology.

Hi Mohammed, thank you for taking the time to speak with me. Path Solutions has been providing software solutions for over 20 years. How do you address the growing competition within the Islamic banking market and stay ahead of your competitors?

Mohammed Kateeb

Mohammed Kateeb

Over the years, Path Solutions has established itself as a dominant player in the growing Islamic financial services sector. The main differentiator between ourselves and our competitors is that we’re 100 percent committed to Islamic banking, in that our system is designed and built from the ground up based on the Sharia rules and regulations. Not only were we the first Sharia-compliant software firm to be recognised and certified by AAOIFI, but we have tremendous expertise in the market and understand the importance of technological advancements if the Islamic sector is to rival its conventional banking counterparts.

How does technology address Sharia compliance and regulation concerns?

If technology has to address Sharia compliance and regulation concerns, it has to incorporate the compliance tools in the system. The first starting point is the importance of a software compliance with Islamic financial standards. Islamic financial institutions/ operations include specific transactions, contracts, rules and regulations to follow; An IT system to be used for Islamic operations’ coverage should support such functions through its processes and system controls that do not enable processing of non-Sharia compliant transactions.

When new standards are issued, Islamic banks also expect from their supporting IT system to enable the institution’s compliance with the new standards, and as such software companies have to always be up-to-date with new standards, and proactive in developing whatever is needed in the system to empower the client’s compliance with these standards, ahead of the client asking for them.

What challenges does technology address for conventional banks that are just now beginning to offer Islamic banking services?

Conventional banks starting to offer Islamic banking services face many challenges in their legacy system on multiple levels:

Their system is fully conventional-focused and as such does not enable offering Islamic products and services and the related operations
Their system does not include built-in procedures and processes for such operations
It does not allow the segregation of funds between restricted and unrestricted accounts which are standard types of accounts in Islamic operations; and it does not allow segregation of funds between conventional operations and Islamic windows operations
Last but not least, is the profit distribution procedure to investors in Islamic banks. It is a specific procedure that is totally different from conventional interest computations.

To properly support Islamic banking operations, a financial institution must move from the legacy conventional system to specialized software for its Islamic operations.

Is technology helping Islamic finance to grow?

Yes, to a big extent by automating day-to-day operations, supporting compliance with local and industry regulations, and reaching wider geographies. In today’s era, no industry can grow and sustain growth without a supporting technology, and the specialized technology is the best to minimize costs, enhance operational efficiencies and reach growth.

What products and services does Path Solutions offer to address operational issues such as efficiency and cost savings?

All of Path Solutions’ products maximize operational efficiencies, ensure internal controls and automated process flows. Our Islamic banking suite is very user friendly and supports Islamic operations with swift services to clients. We also offer reporting and business intelligence solutions that empower banks to develop reports and dashboards and set up alerting messages on specific operational areas. These modules relate to iMAL*BusinessIntelligence & iMAL*ReportDesigner. In addition, Path Solutions recently released iMAL*XDashboards, a powerful executive intelligence tool that provides a consolidated view of the financial institution’s performance, through graphically rich, highly interactive and user friendly dashboards. The solution helps bring critical information to CxOs (‘C’ level executives) and decision makers through its remarkably intuitive interface.

Is Path Solutions planning on releasing any new products or services in 2014?

Yes, our strategy is to always keep up with market trends and directions and offer related products to empower our clients with their operations and increase their market share. The plans for releasing new modules cover multiple areas especially in what relates to regulations and compliance, such as Release 1.1 of iMAL*FATCA for FATCA regulation compliance, improve transfer pricing offering, and delivery channels related such as branchless banking and unified channels management services.

For further details, please go to www.path-solutions.com

Path Solutions provides the industry’s widest range of software solutions to Islamic banks and Islamic financial institutions. Mohammed Kateeb, Group Chairman & CEO of Path Solutions, answers our questions about Islamic Finance Technology.

Hi Mohammed, thank you for taking the time to speak with me. Path Solutions has been providing software solutions for over 20 years. How do you address the growing competition within the Islamic banking market and stay ahead of your competitors?

Mohammed Kateeb

Mohammed Kateeb

Over the years, Path Solutions has established itself as a dominant player in the growing Islamic financial services sector. The main differentiator between ourselves and our competitors is that we’re 100 percent committed to Islamic banking, in that our system is designed and built from the ground up based on the Sharia rules and regulations. Not only were we the first Sharia-compliant software firm to be recognised and certified by AAOIFI, but we have tremendous expertise in the market and understand the importance of technological advancements if the Islamic sector is to rival its conventional banking counterparts.

How does technology address Sharia compliance and regulation concerns?

If technology has to address Sharia compliance and regulation concerns, it has to incorporate the compliance tools in the system. The first starting point is the importance of a software compliance with Islamic financial standards. Islamic financial institutions/ operations include specific transactions, contracts, rules and regulations to follow; An IT system to be used for Islamic operations’ coverage should support such functions through its processes and system controls that do not enable processing of non-Sharia compliant transactions.

When new standards are issued, Islamic banks also expect from their supporting IT system to enable the institution’s compliance with the new standards, and as such software companies have to always be up-to-date with new standards, and proactive in developing whatever is needed in the system to empower the client’s compliance with these standards, ahead of the client asking for them.

What challenges does technology address for conventional banks that are just now beginning to offer Islamic banking services?

Conventional banks starting to offer Islamic banking services face many challenges in their legacy system on multiple levels:

Their system is fully conventional-focused and as such does not enable offering Islamic products and services and the related operations
Their system does not include built-in procedures and processes for such operations
It does not allow the segregation of funds between restricted and unrestricted accounts which are standard types of accounts in Islamic operations; and it does not allow segregation of funds between conventional operations and Islamic windows operations
Last but not least, is the profit distribution procedure to investors in Islamic banks. It is a specific procedure that is totally different from conventional interest computations.

To properly support Islamic banking operations, a financial institution must move from the legacy conventional system to specialized software for its Islamic operations.

Is technology helping Islamic finance to grow?

Yes, to a big extent by automating day-to-day operations, supporting compliance with local and industry regulations, and reaching wider geographies. In today’s era, no industry can grow and sustain growth without a supporting technology, and the specialized technology is the best to minimize costs, enhance operational efficiencies and reach growth.

What products and services does Path Solutions offer to address operational issues such as efficiency and cost savings?

All of Path Solutions’ products maximize operational efficiencies, ensure internal controls and automated process flows. Our Islamic banking suite is very user friendly and supports Islamic operations with swift services to clients. We also offer reporting and business intelligence solutions that empower banks to develop reports and dashboards and set up alerting messages on specific operational areas. These modules relate to iMAL*BusinessIntelligence & iMAL*ReportDesigner. In addition, Path Solutions recently released iMAL*XDashboards, a powerful executive intelligence tool that provides a consolidated view of the financial institution’s performance, through graphically rich, highly interactive and user friendly dashboards. The solution helps bring critical information to CxOs (‘C’ level executives) and decision makers through its remarkably intuitive interface.

Is Path Solutions planning on releasing any new products or services in 2014?

Yes, our strategy is to always keep up with market trends and directions and offer related products to empower our clients with their operations and increase their market share. The plans for releasing new modules cover multiple areas especially in what relates to regulations and compliance, such as Release 1.1 of iMAL*FATCA for FATCA regulation compliance, improve transfer pricing offering, and delivery channels related such as branchless banking and unified channels management services.

For further details, please go to www.path-solutions.com