Why new trade routes will benefit Islamic finance

Islamic finance can help financial institutions strengthen their trade, treasury, payments, and settlement flows.

Islamic finance is increasingly driving capital flows and trade finance across ASEAN, South Asia, Africa, and Gulf countries in the Middle East region, with approximately $6t in deployable assets across nearly 100 jurisdictions, according to Standard Chartered.

Only 6% of global sukuk capital currently reach the South Asia and African markets, presenting a significant opportunity for institutions, the multinational bank said in an August 2026 report.

Islamic finance is becoming a critical enabler of cross-border connectivity, particularly Shariah-compliant capital, Standard Chartered said.

“As its role in facilitating trade, investment and capital flows, continues to grow, financial institutions must place Islamic finance firmly on their strategic agenda," said Khurram Hilal, CEO of Group Islamic Banking at Standard Chartered. 

Rapidly evolving trade routes are also generating new opportunities for Islamic finance.

“GCC-centred, China-centred and Middle East-Türkiye corridors are emerging as priority channels for trade, investment and working capital, helping financial institutions strengthen the resilience of trade, treasury, payment and settlement flows,” the report said.

Private credit’s role as an additional channel for capital deployment is also growing.

“Islamic finance structures can support investment across infrastructure, receivables, trade-linked assets and mid-market businesses while maintaining strong governance and asset-backed principles,” Standard Chartered said.