Foreword

1 Survey of Securities Held as Foreign Exchange Reserves.
Source: International Monetary Fund

Corridor throughput is becoming the new advantage

For financial institutions, the new source of advantage is no longer access to capital alone, but corridor throughput: the ability to move capital, financing, liquidity and transaction flows across borders reliably and at scale. In a more fragmented and volatile environment, a corridor's value lies in how consistently it can perform through changing regulations, shifting risk appetite and tighter FX conditions.

The core constraint is increasingly one of execution rather than liquidity. Cross-border portfolio capital is substantial and growing, but is not flowing in proportion to real economy financing needs across the Global South. IMF Portfolio Investment Positions data show that cross-border portfolio investment asset positions were highly concentrated, with Europe and North America accounting for 79 per cent of the total, leaving the Global South comparatively underrepresented in cross-border portfolio flows. The challenge, therefore, is not simply identifying where capital should go, but ensuring that the channels for execution, distribution, settlement and risk transfer are investable and scalable enough for capital to move with confidence. This places greater importance on the operating models and financial architecture that can help reduce friction and improve corridor execution over time.

'Super connector' is an operating model for reducing friction

In this context, the challenge is not simply one of capital availability, but of financial architecture. As trade, liquidity and investment flows become more fragmented, institutions need operating models that can reduce friction and improve corridor execution. Islamic finance can contribute to that architecture, not only as a source of funding, but through governance frameworks, market access mechanisms and execution networks that help make cross-border activity more investable, scalable and resilient. The concept of the 'super connector' becomes relevant as an operating model that reduces friction across jurisdictions so capital can be deployed, distributed and recycled more effectively.

Building blocks for corridor connectivity

This is how corridor throughput becomes practical. Islamic finance is not only a source of Shariah-compliant funding; it can act as a connector across the operating model itself. It can help link regions through trade and transaction flows, link liquidity through wider capital pathways, and link digital infrastructure by supporting trusted rails for cross-border execution at scale.

For banks, the opportunity lies in stronger corridor execution: better trade, treasury, settlement and transaction banking pathways that make cross-border activity more repeatable.
For investors, the opportunity lies in broader the supply of investable opportunities: access to new issuers, assets and private market opportunities supported by clearer governance, monitoring and distribution frameworks.

These three roles – connector of regions, connector of liquidity and connector of digital infrastructure – are explored in the sections that follow.