Blockchain Based Retail Sukuk for Infrastructure Development and Financial Inclusion in Pakistan

Abstract

Developments around new technology are opening new avenues for business, commerce, and management. From instantaneous, low-cost transaction processing, clearing, and settlement to the management of government & commercial banking ledgers, disruptive technologies like blockchain has numerous applications in financial engineering and innovative product development. Distributed ledger technology can be used to develop innovative Shariah-compliant products including financial instruments that are beneficial for the growth and development of the Islamic finance industry along with the achievement of Sustainable Development Goals (SDGs). In this paper, blockchain technology is proposed to develop Sukuk to finance development infrastructure projects in Pakistan. With adequate governance, innovative products along with legal and regulatory support, Islamic finance has the potential to make a reasonable contribution towards the development of infrastructure along with the rising standard of living for people, eventually supporting Sustainable Development Goals (SDGs) set by the United Nations General Assembly in 2015 for the year 2030. Rigorous infrastructure is the key to the successful implementation and achievement of Sustainable Development Goals (SDGs).