Blockchain tech Image Credit: Pixabay

Dubai: Al Hilal Bank says it has executed a $500 million (Dh1.83 billion) senior sukuk transaction, maturing in September 2023, using blockchain technology.

“The advantages of using smart contracts range from safer transactions with robust Sharia compliance, to the unlocking of new opportunities,” Al Hilal CEO Alex Coelho said in a statement.

The initiative is the result of the collaboration of Al Hilal Bank’s Digital Transformation team with Jibrel Network, a UAE-based FinTech.

“The partnership between Al Hilal Bank and UAE incubated start-up, Jibrel, highlights ADGM’s success in attracting, nurturing and fostering innovation,” Coelho said.

The collaboration was made possible thanks to the support of Abu Dhabi Global Markets’ (ADGM) FinTech platforms that foster an interactive, collaborative and vibrant ecosystem for innovation to take root in Abu Dhabi and the region.

Islamic Sukuk have been successful and one of the fastest-growing asset classes with $97.9 billion worth of Sukuks issued in 2017, representing a 50 per cent increase from 2016.

Jibrel Co-Founder, Talal Tabbaa, highlighted the success of the initiative, saying, “We are firm believers that by combining Jibrel’s tried and tested smart contract solutions with the world class industry expertise held by Al Hilal Bank’s Digital Transformation Team, we will be able to provide Islamic financiers with the necessary tools to facilitate Islamic agreements with the same speed, volume and efficiency experienced in conventional finance, and potentially develop new digital asset classes that were previously unimaginable.”