Bank Negara Malaysia (BNM) will adopt the Malaysian Islamic Overnight Rate (MYOR-i) as the mandatory reference rate for all Islamic financial products beginning July 1, 2027, — a key reform in the nation’s Islamic finance sector.
Speaking at the Global Islamic Finance Forum (GIFF) 2025, Governor Datuk Seri Abdul Rasheed Ghaffour said MYOR-i, the world’s first transaction-based Islamic benchmark rate, will enhance transparency, consistency and shariah compliance.
He said the move is part of Malaysia’s broader plan to strengthen risk-sharing structures, promote inclusive growth, deepen global links and build talent in Islamic finance.
00:00As we mentioned the next phase of growth, allow me to share five developments that
00:13Malaysia is pursuing in advancing the Islamic financial ecosystem. First, we
00:19are encouraging impactful re-engineering of finance. By expanding the use of risk
00:25sharing structures like Musyarakah and Mudarabah, Islamic financial solutions can
00:30be more diverse than transactional debt, offering distinct risk-reward
00:35propositions. The rollout of Aincita Lasman, supported by a hundred million fund
00:42from the government to encourage risk sharing innovation, aims to support more
00:47diverse application of Sharia contracts for viable projects that bring tangible
00:52benefits to Malaysia. To complement this initiative, we are actively reviewing the
00:58Sharia contracts and investment account policies to provide more conducive
01:04regulatory environment for investment intermediation. We hope the industry will
01:09fully optimize these initiatives to test innovative solutions. Second, we are
01:16redefining what inclusive development looks like. Through innovative integration of
01:21Islamic social finance with mainstream financial systems, we seek to chart a new
01:26frontier in finance where social purpose and commercial viability does converge. The
01:34IT card program powered by blended finance is not just a pilot. It is a proof of concept.
01:41It shows how Islamic finance can be mobilized to uplift communities and Islamic banks working
01:48hand-in-hand with state religious authorities and development partners are delivering tangible
01:53outcomes such as increased employment and skill sets. I'm encouraged to see the expansion of the IT card
02:00program for financial protection today, which is supported by the government's matching grant of 5 million for Takaful
02:08contributions. Thank you, Mr. Prime Minister. The collaboration between banks and Takaful
02:13operators further enriches this ecosystem. The challenge now is to scale it up. We must move from selected success to
02:22systemic transformation. The tools are in place. The partnerships are forming. The time is to accelerate now.
02:31Third, Malaysia is positioning Islamic finance as the vanguard of two global growth frontiers. First is the halal economy and second,
02:42sustainable finance. These are not niche markets. There are trillion dollar opportunities waiting to be unlocked.
02:50Through the MIFC Leadership Council, we have laid strategic groundwork for global connectivity. Stronger execution by industry is
03:00now paramount. That is why we are supportive of the formation of the MIFC Business Network or MBN as the next phase of MLC
03:10transition. MBN as a coalition of industry champions will be pertinent in charting our way forward. They will be
03:20tasked with deepening sectoral collaboration, securing tangible business outcomes and scaling impact in
03:27Malaysia and beyond. I'm pleased to announce that there's nine industry players comprising entities from
03:34banking, Takaful, Capital Markets and Ancillary Services have committed to be the founding members of the MBN.
03:42Invitation for wider participation from industry players will be announced soon. The
03:50Bank, alongside other regulators and key stakeholders will remain committed to supporting the industry in
03:57advancing the MIFC agenda. Fourth, BN Malaysia plans to move forward with a new benchmark. Beginning 1 July
04:072027, the Malaysia Islamic Overnight Rate, or we call it the Mayor I, will become the mandatory reference rate for Islamic financial products. This is not just a
04:19technical adjustment, it is a structural transformation. As the world's first transaction based Islamic benchmark rate,
04:28Mayor I brings transparency, consistency and Sharia alignment to the heart of Islamic finance. The fifth and final frontier in advancing Islamic
04:38finance is talent and the ideas and innovation that talent can unlock. Institutions like NCF University are
04:47evolving beyond education into engines of innovation, embedding the Makassid Shari'ah into economic and policy frameworks.
04:57Regionally, IPFIM is scaling up capacity through the enhanced associate qualification in Islamic finance, now tailored for the
05:06ASEAN markets. With country-specific modules for Brunei, Indonesia, the Philippines and Singapore, this programme is building a workforce that is not only
05:18technically technically proficient, but regionally attuned and innovation-ready. The need is clear. If you want Islamic finance to lead,
05:27we must invest to build and nurture talent that can imagine, design and deliver its future.
05:34For Muslim families to improve yields and incomes.
05:39For Muslim families to improve meals,
05:47for Muslim families to invest in Islamic finance,
05:51For Muslim families to be in equal importance.
05:54For Muslim families to learn Indian hexagonal,
05:56For Muslim families to open up their歓s to protect themselves,
05:58For Muslim families to be in equal importance.
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