The Shari’ah Supervisory Board (SSB) of the Bangsamoro Autonomous Region in Muslim Mindanao has issued formal guidelines for stakeholders seeking Shari’ah opinions on Islamic finance matters.
The guidelines, released through SSB Circular No. 1, set out procedures for submitting requests and identify which entities are eligible to seek advisory opinions.
According to the SSB, eligible parties include Islamic banks, takaful and retakaful operators, government agencies, cooperatives, non-governmental organizations, and both financial and non-financial institutions offering Islamic finance products.
Requests may be submitted via postal mail or through the SSB Secretariat’s official email, which will manage the request process from submission to issuance.
The Shari’ah Supervisory Board was created by a joint circular on April 26, 2022, by the Bangko Sentral ng Pilipinas (BSP), Bangsamoro Government, Department of Finance, and the National Commission on Muslim Filipinos.
Its establishment fulfills a shared mandate under the Bangsamoro Organic Law (Republic Act No. 11054), which recognizes the distinct socio-cultural and economic context of the region.
The board also aligns with the national policy under the Islamic Banking Law (Republic Act No. 11439) to promote inclusive finance and a robust Islamic banking ecosystem.
“This is a significant step in strengthening the governance of Islamic finance in BARMM,” said Ustadz Mohammad Omar Pasigan, chairperson of the Shari’ah Supervisory Board.
Pasigan emphasized the importance of ensuring that Islamic finance practices in the region adhere to Shari’ah, saying, “It brings greater confidence and trust to the public, knowing that financial products are vetted by a credible religious authority.”
Islamic finance requires all transactions to comply with Shari’ah, which prohibits interest or “riba” and speculative behavior, encouraging risk-sharing and ethical investments instead.
Under this model, Islamic banks offer alternative profit-generating arrangements, such as cost-plus financing, lease-to-own structures, or profit-sharing partnerships.
The new guidelines also support BSP Circular No. 1070, which lays out the Shari’ah Governance Framework for Islamic banks and Islamic banking units in the country.
The framework mandates banks to maintain an internal Shari’ah advisory council, separate compliance functions, and regular training to ensure adherence to Islamic principles.
“These guidelines institutionalize transparency and accountability in Shari’ah decision-making,” said Dr. Jehan Usop, a member of the SSB and Islamic finance scholar.
Usop added that formalizing the request process allows for more consistent interpretations and ensures uniformity across financial institutions in the region.
The issuance of the guidelines is expected to help stimulate Islamic financial product development, particularly in underserved Bangsamoro communities.
According to BSP data, the Philippine Islamic banking sector remains in its early stages, with only one licensed Islamic bank operating as of 2024.
However, with the SSB’s guidance and ongoing regulatory support, stakeholders hope to broaden Islamic banking access across the country, especially in BARMM where the majority of the population is Muslim.
