1. From Mathematics and Risk to Islamic Finance
Q: Your academic background is in Mathematics, and your early career focused on risk management and actuarial science. How did you transition into Islamic finance? What drew you to this field, and how has your quantitative background shaped your approach to Shari’ah compliance and structuring?
A: I have always had an aptitude for the exact sciences. Mathematics, actuarial calculations and risk management were therefore a natural starting point for me. They taught me to examine assumptions, understand how a model works and ask what happens when circumstances change. My interest in Islamic finance began during my master’s studies. Learning about it was a turning point: I decided to concentrate on this field and started studying it systematically.
What attracted me was the relationship between financial activity and responsibility. Islamic finance asks how income is earned, what the parties actually own, which risks they assume and whether their rights are fairly defined. I found these questions intellectually compelling. They also gave me a way to connect my financial training with principles that I considered meaningful.
The practical transition came when I was invited to join an ambitious project to convert a conventional financial company into an Islamic financial institution. I initially joined as a risk management specialist. We completed the conversion in a short period, using our own team rather than external specialists, which significantly reduced costs. Following the project’s results, I was offered the opportunity to lead the Shariah compliance function. That experience brought together the disciplines that now define my work.
My quantitative background remains useful when reviewing a product. I trace the cash flows, the transfer of ownership and the point at which each party becomes exposed to risk. A payment schedule can be mathematically correct while the underlying transaction has a Shariah problem, for example if a sale takes place before the financier acquires the asset. Quantitative analysis helps me identify the issue, while Shariah analysis determines the permissible structure. I believe the quality of a product depends on both.
2. Pioneering Islamic Finance in Kazakhstan
Q: You’ve been involved in Islamic finance in Kazakhstan since its early days, working with the Regional Financial Centre of Almaty and later with institutions in the AIFC. How has the Islamic finance landscape in Kazakhstan evolved over the past 15 years? What have been the most significant milestones and setbacks?
A: Over these years, I have seen the discussion become much more practical. In the early period, including the work associated with the Regional Financial Centre of Almaty, a substantial part of the effort went into explaining Islamic finance and establishing the conditions for it to operate. Today, institutions increasingly ask how to build a product, obtain the relevant authorisation, organise Shariah oversight and make the service available to clients. That change is important to me because it brings the discussion closer to implementation.
The national legislation adopted in 2009 provided an essential foundation, followed by the opening of Al Hilal in 2010. The development of Islamic financing companies and the conversion of existing institutions demonstrated that the model could also be implemented by local businesses. The launch of the AIFC in 2018 added another legal and regulatory route, with opportunities for banks, non-bank financiers and capital market participants. The Gamma-T Ijarah sukuk in 2024 and the registration of Tayyab’s sukuk programme in 2025 were further practical milestones. I was involved in the Shariah structuring of these projects, so their significance is also personal.
The difficulties have been persistent. In my view, product demand, suitable funding, trained personnel and operational infrastructure have often developed at different speeds. A company can prepare compliant contracts and still struggle to obtain long-term funding or find staff who understand both Islamic contracts and day-to-day financial operations. Public expectations can also be unrealistic: some people expect all financing to be free, while others assume that an Islamic product is simply conventional finance with different terminology.
I therefore assess progress through what institutions can actually deliver. Can a customer understand the product and access it conveniently? Can the institution manage the risks and demonstrate that transactions follow the approved structure? Can it continue doing so as the portfolio grows? Kazakhstan has accumulated valuable experience, but the next stage requires greater consistency in execution. Professional training and dependable funding are particularly important if we want the market to expand sustainably.
3. The AIFC Advantage
Q: The Astana International Financial Centre (AIFC) operates under English common law, which has facilitated the establishment of Islamic banks like Al Safi Bank, Al Saqr Islamic Bank, and others. How does the AIFC framework support Islamic finance differently from the conventional Kazakhstani legal system? What role have you played in obtaining licenses for these institutions?
A: For me, the main advantage of the AIFC is that it brings a dedicated regulatory framework and a familiar legal environment together. Its legal system is based on the principles of English common law, and AFSA regulates the financial activities carried out within that framework. The Islamic Finance Rules address matters such as Shariah supervision, internal controls and disclosures. These features help a project team understand what it must put in place and help international partners assess the proposed arrangements.
Kazakhstan’s national legislation also provides a framework for Islamic finance. The practical difference is that the AIFC offers a distinct route for setting up and authorising financial businesses. It is important to choose the route according to the institution’s actual activities. An Islamic bank and a company authorised to provide Islamic financing have different permissions and regulatory obligations. The latter should not be presented to customers as a deposit-taking bank simply because its products are Shariah-compliant.
I participated in licensing projects for Al Saqr Islamic Bank and Al Safi Bank, as well as projects involving Islamic financing companies. My contribution centred on Shariah governance, product structures and documentation, together with the policies and procedures needed to implement them. That work requires translating the proposed business model into a clear transaction sequence and explaining how the institution will monitor compliance in practice. It is a team effort involving the applicant’s management and other specialists, with the authorisation decision belonging to the regulator.
The AIFC also needs to be understood in its local context. A transaction may involve an AIFC entity while the financed property, customer or supplier is located elsewhere in Kazakhstan. National rules governing assets, registration, taxation or enforcement may therefore remain relevant. In my view, a successful structure must work across that interface. A licence establishes the permitted scope of business; the institution then has to demonstrate that its people and systems can carry out that business properly.
4. Sukuk Structuring Experience
Q: You’ve structured Sukuk Wakala for Tayyab Finance and Sukuk Ijarah for Gamma-T LLP, both listed on the AIX. What are the key Shari’ah and practical considerations in structuring Sukuk for the Kazakhstani market? What challenges did you face, and how did you overcome them?
A: My work on the Gamma-T Ijarah sukuk and the Tayyab Wakala Bil Istithmar sukuk illustrates why the structure has to follow the underlying business. Ijarah is based on leasing identifiable assets or usufructs. Wakala Bil Istithmar uses an investment agency arrangement under which the agent manages investments within an agreed mandate. Both can raise financing, but they create different rights, responsibilities and risks. I begin by examining whether the proposed assets and cash flows can support the chosen model.
For an Ijarah structure, important questions concern the assets’ eligibility, the rights transferred to the issuing vehicle and the allocation of ownership-related responsibilities. Rental payments must relate to the lease, and the treatment of major maintenance, insurance and periods when the asset cannot be used requires careful attention. A service agency arrangement can delegate the performance of certain tasks, but it must preserve the relevant responsibilities of the owner. For an investment Wakala structure, the mandate, permitted investments, agent’s remuneration and treatment of investment losses need to be clearly defined.
Another important issue is tradability. A portfolio can contain tangible assets, usufructs and receivables, and its composition may change as transactions mature. The applicable Shariah requirements therefore need to be considered throughout the programme. Any purchase undertakings or support arrangements also have to be assessed in relation to the specific structure. Investors should understand their enforceable rights, the source of distributions and the risks associated with the originator and underlying assets.
In the projects I worked on, bringing the commercial model, contracts and transaction sequence into alignment was central to the structuring task. In Kazakhstan, there is also a practical need to explain the model clearly to counterparties accustomed to conventional bonds. I approach this through a detailed transaction map, review of the asset pool and careful checking of how the documents operate together. Legal, tax, accounting and listing questions require coordination with the relevant specialists. The result should be a structure that the issuer can operate and that investors can understand, with continued Shariah oversight after issuance.
5. Shari’ah Advisory Across Multiple Institutions
Q: You currently serve as a Shari’ah Advisor on the Shari’ah Supervisory Boards of Zaman-Bank, Ailat Finance, Leasing Group, Mizan Islamic Finance, and Tayyab Finance. How do you manage your responsibilities across multiple institutions? How do you ensure consistency in your rulings and maintain independence?
A: I see this work as a responsibility to each institution and to the people who rely on its products. Through ShariaConsulting AFC Ltd. I work with institutions on Shariah governance and its practical implementation. An advisory role across several organisations requires clear boundaries, sufficient time for review and effective internal support. I consider it essential that each institution has people responsible for daily Shariah compliance and a process for bringing significant issues to its supervisory board. A board cannot personally observe every transaction, so it needs reliable information about how approved products are actually being used.
Consistency starts with the method of analysis. I refer to the applicable Shariah standards, the substance of the contracts and the relevant regulatory requirements. The reasoning should be documented so that a similar issue can be examined on a comparable basis. At the same time, similar product names do not necessarily mean identical transactions. Different ownership arrangements or contractual obligations may justify different conclusions. I try to make those differences explicit rather than transfer an earlier approval automatically to another institution.
Board decisions are collective decisions. My role is to contribute the financial, operational and Shariah analysis needed for an informed discussion. Approval should also identify the conditions that matter in implementation. If a product is subsequently changed, or practice departs from the approved sequence, there needs to be a route for review and correction. This is why I place considerable importance on continuing compliance and independent audit.
Independence means being able to reach a professional conclusion without pressure to accommodate a commercial target. I regard conflict disclosure, appropriate recusal and confidentiality as essential safeguards. Documents and information belonging to one institution must remain protected when working with another. I also believe that advisory and audit responsibilities should be arranged to avoid reviewing one’s own work without independent challenge. Ultimately, institutions benefit when their advisers can explain a concern clearly and propose a workable, permissible solution without compromising the underlying requirement.
6. Islamic vs. Conventional Finance in Kazakhstan
Q: From your experience, what is the most significant misconception about Islamic finance among Kazakhstani businesses and consumers? How do you explain the value proposition of Islamic finance to a predominantly secular, post-Soviet audience?
A: The misconception I consider most consequential is that Islamic finance is simply a conventional loan with the word “interest” replaced by “profit”. There is also the opposite expectation that the absence of interest means the institution must provide financing without earning any return. Both views make it harder to explain what the contracts actually do. Trade, leasing and investment can generate a legitimate return, but the return must arise from a permissible transaction with the corresponding responsibilities.
I usually begin with an example that the customer recognises. In Murabaha, the financier acquires an asset and sells it to the customer at an agreed price, which includes a disclosed profit. The acquisition and possession must genuinely take place. Once the sale creates a debt, extending the payment period cannot by itself justify increasing that debt. In Ijarah, the financier leases an asset and retains the responsibilities associated with ownership. The customer pays for its use. These differences affect the transaction and the allocation of risk even when a payment schedule resembles a conventional financing schedule.
For a secular audience, I discuss matters that are relevant regardless of religion: clarity of contractual terms, the source of the financier’s income, responsibility for the asset and the treatment of the customer when circumstances change. Islamic finance is accessible to non-Muslim clients as well. I would not claim that every Islamic product is automatically cheaper or that every contract shares business profits and losses. The value needs to be demonstrated through the actual terms and service.
My broader view is that the industry should use its principles to improve the customer’s position wherever the structure allows it. That can mean clearer ownership responsibilities, transparent pricing or a partnership model suited to a particular business project. Religious compliance matters to many clients, but good product design should also give them reasons to choose the service on its practical merits. I want Islamic finance in Kazakhstan to compete through the quality of that experience.
7. The Conversion Process: From Conventional to Islamic
Q: You’ve been involved in converting conventional financial institutions into Islamic ones, including Al Saqr Finance JSC. What are the biggest challenges in converting a conventional financial institution to an Islamic one? What are the critical success factors?
A: My experience with the conversion that resulted in Al Saqr Finance, previously SK Leasing, taught me how much depends on changing the way the institution actually works. The challenge is substantial because its existing contracts, funding arrangements and operating procedures have been designed for a different model. New contracts need to fit the business, and staff need to understand the actions that make those contracts valid.
I consider a thorough initial assessment essential. The team needs to examine the existing portfolio, liabilities, cash placements and income streams. Different items may require different treatment, such as settlement, restructuring, replacement or a transition arrangement approved by the Shariah board. Legacy income also needs appropriate assessment. An institution cannot assume that a change of name or the approval of new product documents resolves every issue in its existing business.
The operational changes are equally demanding. In a sale-based product, the institution must be able to purchase and take possession of an asset before selling it onward. In a lease, it must recognise the responsibilities that follow from ownership. Procurement, accounting, legal documentation and IT therefore need to support the same sequence. Employees who have spent years working with conventional financing may initially see these steps as unnecessary formalities. Training needs to explain their purpose and show staff how to carry them out.
The main success factors, in my view, are a clear commitment from the owners and management, a realistic transition plan and close cooperation across functions. The Shariah board should be involved early enough to influence the model. Products should be tested through complete transactions before wider rollout, and the institution needs continuing monitoring after conversion. In our project, completing the work internally helped us reduce costs and build knowledge within the organisation. That experience reinforced my belief that internal capability is one of the most valuable results a conversion can produce.
8. Islamic Windows and Products
Q: You worked on an Islamic Window for Leasing Group JSC in 2023. What are the unique challenges of establishing an Islamic window within a conventional financial institution? How do you ensure Shari’ah compliance and prevent commingling of funds?
A: The work on Leasing Group’s Islamic window in 2023 involved developing an Islamic financing activity within an existing conventional leasing company. I would distinguish that project from an Islamic banking window: the permissions and applicable legal requirements depend on the institution and its activities. The attraction of a window is that it can use existing expertise and infrastructure, but this also makes it necessary to define carefully which arrangements can be shared and which require separation.
I consider the financial boundary particularly important. The Islamic activity needs identifiable assets, liabilities, income and expenses, supported by records that allow its transactions and funding to be traced. Dedicated accounts or subaccounts, an appropriate ledger and regular reconciliation can support that separation. Shared overheads also need a transparent allocation method. Merely assigning a product code does not establish that funds have been handled correctly.
Funding arrangements must be assessed and approved for the Islamic activity. The allocation of capital, any transfers between the conventional and Islamic businesses, and the use of temporarily available cash should follow the approved rules. Interest-bearing arrangements should not automatically carry over into the window’s treasury operations. Where non-compliant income is identified, its treatment must be determined through the appropriate Shariah process. The purpose of these controls is to make separation demonstrable throughout the transaction cycle.
Product governance presents another challenge. Shared staff and systems need to respect the approved purchase, possession and leasing sequence. Contracts must allocate ownership responsibilities correctly, and changes made elsewhere in the company should not inadvertently alter the Islamic products. I therefore regard staff training, transaction-level checks and independent review as essential. Customers should also receive clear information about the provider and the scope of its Islamic activity. A window is sustainable when it can demonstrate these safeguards while using the parent organisation’s resources efficiently.
9. Risk Management and Shari’ah Compliance
Q: You hold both the FRM and CISRM certifications, and you’ve headed Risk & Shari’ah Compliance departments. How do risk management and Shari’ah compliance intersect in an Islamic financial institution? What are the unique risks that Islamic banks face compared to conventional banks?
A: I see risk management and Shariah compliance as closely connected disciplines with distinct responsibilities. Risk management assesses exposures and the institution’s ability to withstand losses. Shariah compliance examines whether the business and its transactions follow the applicable principles and approvals. A sound Islamic financial institution needs both. Compliance does not remove credit, market, liquidity or operational risk, and a favourable risk assessment cannot validate an impermissible transaction.
An important difference is that risk can change during the stages of a single transaction. In Murabaha, the institution may first face asset-related risks while it owns the goods and later face credit risk once it has sold them on deferred terms. In Ijarah, it retains ownership-related exposure during the lease. In investment partnerships, normal business losses must be distinguished from losses caused by misconduct or breach. The contract therefore affects how an exposure should be understood and managed.
Shariah non-compliance risk is particularly significant. An incorrect sequence, an invalid agency arrangement or inadequate evidence of possession may affect the validity of a transaction or the acceptability of its income. The consequences may include remediation, exclusion of income from distributable earnings and reputational damage, depending on the findings. That risk needs preventive controls and monitoring. When an issue is found, the risk and compliance teams should work with the Shariah board to understand its scope and determine the appropriate response.
Islamic banks also need suitable liquidity tools and funding arrangements. In a developing market, the range of available compliant instruments may be limited. Banks managing profit-sharing investment accounts may face additional pressures connected with investment performance and customers’ return expectations. My FRM and CISRM background helps me connect these financial questions with the contracts that generate the exposure. I favour controls that give both functions access to the same transaction evidence, while preserving their respective authority and independent reporting.
10. Training and Capacity Building
Q: You lecture in the FRM program at Narxoz Business School and teach the AAOIFI CSAA program at Sanabeel AAOIFI Kazakhstan. What are the biggest skill gaps you observe among professionals entering Islamic finance in Kazakhstan and Central Asia? What advice would you give to someone aspiring to build a career in this field?
A: In teaching risk management and AAOIFI programmes, I pay particular attention to the gap between knowing a rule and being able to apply it. Some participants have strong banking experience but limited familiarity with Islamic contracts. Others understand the terminology and principles but have less experience with financial analysis or operating processes. The most useful training helps them connect these areas through a complete transaction.
For example, recognising the definition of Murabaha is only the beginning. A practitioner should be able to explain who purchases the asset, when possession occurs, what the agency authorises and when the sale to the customer becomes effective. They should also understand which documents prove those steps and what happens if the customer refuses the purchase or the supplier fails to deliver. Similar practical questions arise in leasing, partnerships and sukuk. I find that case analysis and contract review help turn theoretical knowledge into professional judgement.
Another gap concerns Shariah governance. Institutions need specialists who can maintain approval records, recognise deviations, assess their significance and communicate them to management and the Shariah board. Financial modelling, accounting, legal literacy and clear writing also matter. In Kazakhstan and Central Asia, professionals must understand how international standards interact with local law and market practice. Access to English-language source material is useful, while explaining products accurately in local languages is equally important.
My advice is to develop a sound foundation in finance and Islamic commercial jurisprudence, then gain practical experience in a clearly defined area. International qualifications such as FRM, CSAA and CIBAFI programmes can provide structure, but they need to be accompanied by continuing study and supervised work. I also see considerable value in a local training pathway that progresses from foundations to applied specialisations. We need competent people in operations, risk, audit and product development as well as advisers. A worthwhile career in this field grows through careful work, the ability to explain one’s reasoning and a willingness to recognise the limits of one’s expertise.