The Banking Executive Magazine - May 2026 Issue

Islamic Finance UNIDO contributes technical expert- ise in enterprise development, value- chain upgrading, and investment readiness. UAB anchors engagement with regional banking networks. AAOIFI provides alignment with Shariah standards and regulatory frameworks, while AFC contributes direct investments, capacity and ex- perience in structuring scalable fi- nancing and guarantee solutions. Through UAB, AAOIFI and AFC members and networks, IFETAA is positioned to reach a broad spectrum of Arab and African financial institu- tions, ensuring that its tools and in- sights directly support banks’ strategic priorities. At the core of IFETAA lies a simple insight: SME finance fails when fi- nancial and non-financial risks are treated separately. Banks are equipped to price financial risk, but they are often confronted with non- financial risks, weak business mod- els, operational inefficiencies, governance gaps, that lie outside their traditional remit. IFETAA inte- grates technical assistance, pipeline development, and risk-sharing into a single framework, aligning incentives across institutions. ADDRESSING BANKS’ CONSTRAINTS THROUGH A FIVE-PILLAR MODEL IFETAA’s operating model is struc- tured around five mutually reinforc- ing pillars, each corresponding directly to constraints faced by finan- cial institutions. Capacity building for financial insti- tutions focuses on strengthening ex- isting capabilities and supporting banks as they expand their Islamic SME portfolios. Through joint pro- grammes with UAB and AAOIFI, IFE- TAA works alongside banks to enhance Shariah alignment, risk management practices, and sustain- ability integration within their SME strategies. Pipeline development addresses one of the most persistent constraints: the absence of investment-ready proj- ects. Through structured screening and appraisal using harmonised the BANKING EXECUTIVE 44 ISSUE 209 MAY 2026