Al-Amanah Bank to Expand Halal Financing for MSMEs

MANILA, Philippines — The Al-Amanah Islamic Investment Bank of the Philippines is set to expand its financing for businesses within the halal industry, with a particular focus on micro, small, and medium enterprises (MSMEs). This move aligns with the government's broader strategy to tap into the rapidly growing global halal market. The state-run bank has committed to providing capital to halal industry businesses that have historically faced difficulties securing financing due to not meeting the conventional requirements of most financial institutions. Al-Amanah Bank Chairperson and CEO Amenah Pangandaman highlighted the demand and market potential during the Philippine Halal Industry Summit, stating, "We have the demand to fill, we have our people to do the job, we have a huge market waiting for us but without the capital— the financing — it will always be an arduous task to get out of that niche market concept attached to halal." Pangandaman emphasized that financing must support the entire halal value chain, from production and certification to logistics, scaling up, and eventual export. She also pointed out that halal certification itself is a significant hurdle for many MSMEs, often requiring substantial investment in facilities and processes. "Unfortunately, many MSMEs are having a hard time financing the costs needed to enter the halal market, such as certification and facilities and production upgrades, among others," she noted. To address these challenges, Al-Amanah is collaborating with the Department of Trade and Industry (DTI) through a Memorandum of Understanding (MOU) to provide financing for halal expansion, including accreditation fees and halal slaughterhouse facilities. The bank is also partnering with the Cooperative Development Authority to bolster cooperatives involved in the halal sector and has agreed to a similar MOU with the National Commission on Muslim Filipinos for Islamic financing support to MSMEs and halal certifying bodies. "We should not miss the boat. There is so much room for growth — growth to show that halal is more than just a dietary restriction in observance of our faith. But it is an opportunity to push forward economic development alongside inclusivity," Pangandaman added. The global halal industry is estimated at $4 trillion and projected to reach $10 trillion by 2030, driven by a growing Muslim population and increasing ethical consumerism, with non-Muslim consumers also showing preference for halal products due to their adherence to high standards. The Philippine Halal Industry Development Strategic Plan aims to attract P230 billion in investments by 2028, double the number of halal-certified products and services to 6,000, and create 120,000 jobs. However, the country currently faces a supply gap, relying on imports valued at over $100 million in previous years. Pangandaman, who previously resigned as budget secretary, returned to public service with her appointment to head Al-Amanah Bank in July.