Nigeria's Islamic Finance Growth: IFSB 2026 Report Insights

The Islamic Financial Services Board (IFSB) 2026 stability report reveals that the global Islamic finance industry is projected to reach $4.4 trillion by 2025, reflecting a 13.4% annual growth rate. Nigeria is identified as one of the fastest-growing Islamic banking markets globally, with a 24.9% compound annual growth rate (CAGR) in Islamic banking assets.

Factors contributing to this growth include the expansion of non-interest banking licenses, starting with Jaiz Bank PLC in 2011, followed by Taj Bank Ltd, Lotu Bank Ltd, Altern Bank Ltd, and Summit Bank Ltd. The report also notes Nigeria's significant achievements in sovereign sukuk issuance, raising hundreds of billions of naira for infrastructure projects, including roads and bridges.

Between 2017 and 2023, Nigeria built thousands of kilometers of roads funded through sukuk, demonstrating the effectiveness of Islamic finance in infrastructure development. The report emphasizes the need for regulatory support to enhance the Islamic finance ecosystem in Nigeria.