In Kuwait, Boubyan Bank is on a mission to establish itself as a prominent force in the Islamic banking sector not only within its home market but also on a global scale. Adel Al-Majed, the Vice-Chairman and Group CEO, shares insights into how the bank plans to achieve this lofty goal through innovative financial products, advanced digital services, and strategic partnerships.

Unlock the Potential of Kuwait's Islamic Banking Giant

Strategic Priorities over the Next Five Years

The bank aspires to be a leading Islamic bank catering to high-net-worth individuals and companies. Under the Boubyan 2028 plan, it will continuously expand its core businesses and products. Simultaneously, it will actively seek strategic partnerships to generate substantial shareholder value and drive growth. This approach combines traditional banking with a forward-thinking mindset to stay ahead in the competitive landscape.For instance, by focusing on innovation and digital excellence, the bank can offer seamless banking experiences to its clients. It can leverage technology to reach a wider audience and provide more personalized services. This not only enhances customer satisfaction but also positions the bank as a modern and dynamic player in the industry.

Growth in Commercial Business Segments

The PRIME (youth) and Premium (top-tier affluent) segments have witnessed remarkable growth in recent years. In the PRIME segment, Boubyan has emerged as a pioneer, introducing new products and services. It has managed to capture a significant market share among Kuwaiti youth, demonstrating its ability to understand and meet the needs of this demographic.The Premium segment, a relatively new subgroup within the affluent category, offers exclusive benefits such as dedicated relationship managers, access to special hubs in each branch, and global concierge services. This targeted approach allows the bank to provide personalized attention and value to its high-net-worth customers.

Activity in Retail Business Segments

The Mass segment is the largest group, driving the usage of all bank products. It serves as the foundation for the bank's operations and ensures widespread accessibility. The PRIME segment, on the other hand, is highly active on social media and engages with merchant partners through discount offers. This combination of mass reach and targeted marketing strategies helps the bank attract and retain customers.The Platinum (mass affluent) segment customers are power users of credit card services, with an above-average spend per transaction. This indicates their confidence in the bank's financial offerings and their willingness to use credit to enhance their lifestyles. The Premium (top-tier affluent) segment leads in terms of deposits and current and savings account holdings (CASA), highlighting its importance in the bank's portfolio.

Key Developments in Islamic Finance

One significant development in Islamic finance is the global growth of sukuk (Islamic bonds). The demand for Sharia-compliant investment options has led to an expansion of this market, particularly in the Middle East, Southeast Asia, and Africa. Islamic banks are now focusing on financial inclusion, reaching out to underbanked markets in these regions.Sharia-compliant microfinance solutions play a crucial role in providing ethical financing to individuals and small businesses. By using asset-based structures like Ijarah (leasing) or murabaha (cost-plus financing), these solutions offer alternatives to interest-based loans. At the local level, many countries have been working to refine their legal and regulatory frameworks to support Islamic finance. For example, the UK has introduced regulations to facilitate Islamic banking, while Saudi Arabia and Malaysia continue to strengthen their Islamic finance laws.

Steps to Promote FinTech Growth

Boubyan has adopted a comprehensive and proactive approach to FinTech. It engages with the community through hackathons, accelerators, and other challenges for both internal and external participants. This encourages innovation and collaboration within the FinTech ecosystem.The bank offers a wide range of financial services, including traditional offerings like escrow accounts, bulk transfers, and payment infrastructure. It also introduces newer offerings such as ATM as-a-service, BIN sponsorship, wallet acceptance, and embedded banking. These initiatives allow the bank to stay at the forefront of technological advancements and meet the evolving needs of its customers.In addition, Boubyan is actively involved in FinTech mentorship, providing strategy, implementation, and operational advice and support. It has sponsored 80% of FinTech applicants to the Central Bank of Kuwait's Regulatory Sandbox, demonstrating its commitment to fostering innovation in the FinTech space. The bank also makes strategic venture capital investments, starting from early stages to late stages, to align with its core business and long-term goals.