Islamic venture capital in Malaysia: development, constraints and way forward

Purpose: This study aims at examining the development of the Malaysian Islamic venture capital industry including government and regulatory policy initiatives for escalating the growth of the industry. It also highlights constraints and way forward for the industry. Methodology: The paper employs q...

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Main Authors:	Mikail , Sa'id Adekunle, Arifin, Mahama, Hassan, Rusni
Format:	Article
Language:	English
Published:	Hamdan bin Mohammad e-University 2014
Subjects:	H Social Sciences (General) HG4001 Financial management. Business finance. Corporation finance.
Online Access:	http://irep.iium.edu.my/36279/ http://irep.iium.edu.my/36279/ http://irep.iium.edu.my/36279/1/Islamic_VC-IJEIBF.pdf

id	iium-36279
recordtype	eprints
spelling	iium-362792014-04-29T02:08:29Z http://irep.iium.edu.my/36279/ Islamic venture capital in Malaysia: development, constraints and way forward Mikail , Sa'id Adekunle Arifin, Mahama Hassan, Rusni H Social Sciences (General) HG4001 Financial management. Business finance. Corporation finance. Purpose: This study aims at examining the development of the Malaysian Islamic venture capital industry including government and regulatory policy initiatives for escalating the growth of the industry. It also highlights constraints and way forward for the industry. Methodology: The paper employs qualitative approach focusing on secondary resources, documents, and field interview with practitioners and academia who are directly involved in the operations of Islamic venture capital in Malaysia. Findings: The study finds that policy-driven approach and liberalization facilitate the standardization of Shariah rulings of Shariah Advisory Council (SAC) and Shariah Committee (SC), which contribute to the effectiveness of regulatory framework and sustainable growth of the Islamic capital market in Malaysia. It also finds a number of constraints that dampen the progress of Islamic venture capital in Malaysia to be the following: i) apparent resistance of major Islamic banks to get involved in Islamic venture capital investment, ii) biasness against long-term investment; iii) underutilization of mushaarakah and mudaarabah mode of financing, iv) preference of expansion stage over seed capital by major venture capital institutions; v) lack of awareness on Islamic venture capital investment; vi) overreliance on government intervention. Practical Implications: This paper holds significant implications for the venture capital industry players because it provides gap which needs to fill to make the industry a success. Originality/Value of Paper: This paper sheds new light on the development of Islamic venture capital in Malaysia and constraints that stifle the progress of the industry. It also provides way forward for the industry. Hamdan bin Mohammad e-University 2014 Article PeerReviewed application/pdf en http://irep.iium.edu.my/36279/1/Islamic_VC-IJEIBF.pdf Mikail , Sa'id Adekunle and Arifin, Mahama and Hassan, Rusni (2014) Islamic venture capital in Malaysia: development, constraints and way forward. International Journal of Excellence in Islamic Banking & Finance, 4 (1). pp. 1-13. ISSN 2220-8291 http://journals.hbmeu.ac.ae/Pages/Articles.aspx?AID=285&IID=67
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	H Social Sciences (General) HG4001 Financial management. Business finance. Corporation finance.
spellingShingle	H Social Sciences (General) HG4001 Financial management. Business finance. Corporation finance. Mikail , Sa'id Adekunle Arifin, Mahama Hassan, Rusni Islamic venture capital in Malaysia: development, constraints and way forward
description	Purpose: This study aims at examining the development of the Malaysian Islamic venture capital industry including government and regulatory policy initiatives for escalating the growth of the industry. It also highlights constraints and way forward for the industry. Methodology: The paper employs qualitative approach focusing on secondary resources, documents, and field interview with practitioners and academia who are directly involved in the operations of Islamic venture capital in Malaysia. Findings: The study finds that policy-driven approach and liberalization facilitate the standardization of Shariah rulings of Shariah Advisory Council (SAC) and Shariah Committee (SC), which contribute to the effectiveness of regulatory framework and sustainable growth of the Islamic capital market in Malaysia. It also finds a number of constraints that dampen the progress of Islamic venture capital in Malaysia to be the following: i) apparent resistance of major Islamic banks to get involved in Islamic venture capital investment, ii) biasness against long-term investment; iii) underutilization of mushaarakah and mudaarabah mode of financing, iv) preference of expansion stage over seed capital by major venture capital institutions; v) lack of awareness on Islamic venture capital investment; vi) overreliance on government intervention. Practical Implications: This paper holds significant implications for the venture capital industry players because it provides gap which needs to fill to make the industry a success. Originality/Value of Paper: This paper sheds new light on the development of Islamic venture capital in Malaysia and constraints that stifle the progress of the industry. It also provides way forward for the industry.
format	Article
author	Mikail , Sa'id Adekunle Arifin, Mahama Hassan, Rusni
author_facet	Mikail , Sa'id Adekunle Arifin, Mahama Hassan, Rusni
author_sort	Mikail , Sa'id Adekunle
title	Islamic venture capital in Malaysia: development, constraints and way forward
title_short	Islamic venture capital in Malaysia: development, constraints and way forward
title_full	Islamic venture capital in Malaysia: development, constraints and way forward
title_fullStr	Islamic venture capital in Malaysia: development, constraints and way forward
title_full_unstemmed	Islamic venture capital in Malaysia: development, constraints and way forward
title_sort	islamic venture capital in malaysia: development, constraints and way forward
publisher	Hamdan bin Mohammad e-University
publishDate	2014
url	http://irep.iium.edu.my/36279/ http://irep.iium.edu.my/36279/ http://irep.iium.edu.my/36279/1/Islamic_VC-IJEIBF.pdf
first_indexed	2023-09-18T20:51:56Z
last_indexed	2023-09-18T20:51:56Z
_version_	1777410052494196736

Islamic venture capital in Malaysia: development, constraints and way forward

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