JEDDAH, KINGDOM OF SAUDI ARABIA: The Islamic Development Bank Institute (IsDBI) has initiated a project to explore opportunities for offering innovative Islamic financial services through the postal network in an increasingly digital world.
Due to their expansive footprint and broad network coverage, and specialization in the collection and delivery of parcels, postal networks have the unique potential to leverage technology and integrate Islamic financial services to address the needs of underserved communities and those excluded from the formal financial system.
Through the introduction of Islamic financial services and products as part of their offerings, postal services would be able to diversify their revenue sources and provide an avenue for customers who may not be willing to use the traditional banking system. The bundling of financing and delivery services can lead to an increase in efficiency due to the position of the postal services provider between the involved supply chain parties, such as manufacturers and retailers.
The new IsDBI project will assess the postal services market landscape and operational models and conduct a pilot feasibility study for the introduction of Digital Postal Islamic Financial Services in IsDB Member Countries.
The combination of digital solutions with Islamic finance can serve as an important tool for achieving the Sustainable Development Goals (SDGs), including reducing inequality (SDG 10) and enhancing financial inclusion and innovation (SDG 9).
Strongly aligned with the IsDB Group’s strategic objectives of tackling poverty and building resilience, and driving green economic growth, the new initiative will support the transformation of postal services as a key infrastructure institution in IsDB Member Countries to enhance financial inclusion through innovative digital solutions.
The IsDB Institute is planning to organize a webinar in July 2023 to discuss the innovations and digital finance trends in the postal services landscape.