Many stakeholders would prefer to see Islamic banks offering more profit & loss sharing products & services. However, this is very difficult due to the way banks are regulated and what they have been established for. Alternative Islamic financial institutions are much better suited for this and more of them are needed in different jurisdictions.
In KSA, for example they have many investment banks and investment companies which are regulated seperately to traditional banks, that establish all types of innovative funds, both private and public, in various sectors of the economy.
The size and number of these funds is huge, and there is a big appetite for such products amongst investors, even if there is investment risk involved. For example, a Shariah compliant investment bank that I was previously attached to, recently launched its 6th Shariah compliant ETF and raised approximately SAR 4.5 𝗕𝗶𝗹𝗹𝗶𝗼𝗻 from investors.
