In today’s evolving regulatory and ethical landscape, Islamic financial institutions are under increasing pressure to implement international accounting standards such as IFRS 9 while remaining fully compliant with Shariah principles. At FineIT, we have always believed that compliance, innovation, and faith-based finance can coexist harmoniously. Building on the success of our widely adopted Estimator9, we proudly introduce Estimator9-S — a robust, fully Shariah-compliant IFRS 9 platform tailored for Islamic finance.
Why Estimator9-S?
Estimator9-S is engineered for:
- Islamic banks
- Takaful operators
- Islamic microfinance institutions
- Development finance institutions adhering to Shariah
This solution offers a seamless way to implement AAOIFI-aligned Expected Credit Loss (ECL) models and fulfill regulatory reporting requirements while upholding Islamic finance ethics and contract structures.
Key Features
- AAOIFI-aligned ECL models with modular configuration
- Support for a variety of Islamic financial contracts
- Fully automated staging and provisioning logic
- Macroeconomic overlays for forward-looking assessments
- Role-based dashboards for risk, Shariah compliance, audit, and finance teams
Understanding ECL in a Shariah Context
Key Shariah Contracts Covered:
1. Murabaha
In Estimator9-S, Murabaha exposures are assessed through deferred payment schedules with fixed margin profiles. ECL models focus on customer payment behavior while respecting the non-interest nature of Murabaha transactions. Profit recognition and impairment are computed without violating the principles of riba prohibition.
2. Ijara
Under Ijara, asset ownership remains with the lessor. Estimator9-S enables dual-layer modeling to account for both asset risk (depreciation, loss of utility) and lessee risk (default). It dynamically separates rental income from principal exposure in accordance with AAOIFI guidance.
3. Musharaka & Mudaraba
Profit-and-loss sharing contracts are fundamentally different from debt-based structures. Estimator9-S uses equity-style ECL modeling, relying on capital-at-risk, projected profit share variability, and historical behavioral patterns of partners. This helps institutions compute impairment without infringing on mudarib-mushaarik contractual sanctity.
4. Istisna & Salam
For forward contracts like Istisna and Salam, Estimator9-S models expected fulfillment risk and counterparty creditworthiness. Delayed delivery or non-performance triggers provisioning through a Shariah-approved impairment approach.
Technical Architecture
Estimator9-S leverages the Estimator9 core engine enhanced with Shariah-specific rule sets and audit layers. It is built on Python and Laravel stack, ensuring:
- High scalability and multi-tenant deployment
- Microservice-based modularity
- REST APIs for integration with core banking systems
- Role-based access control and data-level encryption
ECL Methodologies Supported
- 3-stage impairment model adapted to Islamic finance
- Customized Probability of Default (PD), Exposure at Default (EAD), and Loss Given Default (LGD) calibrated for different Islamic products
- Incorporates forward-looking information including GDP, inflation, sectoral stress, and unemployment, adjusted for regions with Islamic banking prevalence
Reporting and Compliance
- Generate compliant reports for regulators like IFSB, AAOIFI, and central banks
- Export in PDF, XLS, and machine-readable JSON formats
- Configurable dashboards and alerts for timely provisioning
Deployment Options
- On-premises (with multi-tenant support for Islamic banking groups)
- Cloud-based (with compliance to data sovereignty laws)
- Hybrid models with secure API integration
What Sets Estimator9-S Apart
- Tailored for Islamic finance from the ground up — not a retrofit of conventional systems
- Trusted ECL engine from Estimator9 with over 1 million risk exposures processed across diverse financial institutions
- In-house advisory collaboration with Shariah scholars and quantitative analysts
- Supports multi-lingual and region-specific implementations (Arabic, Urdu, Bahasa, etc.)
Looking Ahead
As the Islamic finance industry grows beyond $3 trillion in global assets, tools like Estimator9-S become essential in bridging the gap between international accounting standards and faith-based financial practice. Estimator9-S is more than software — it’s a strategic enabler of ethical, data-driven, and compliant financial governance.
We invite Islamic banks, fintechs, regulators, and advisory firms to schedule a demo of Estimator9-S and see how it can serve their Shariah and regulatory roadmap.
For more information, reach out to our team at info@fineit.io or schedule a walkthrough via [Demo Link].
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