Fishing Industry Gets a Boost as Government Provides Islamic Financing for Refrigerated Sea Water Systems

MALE’, Maldives – In a move to modernize the fishing industry and improve the livelihoods of the fishermen, the government has rolled out a new Islamic financing program to install Refrigerated Sea Water (RSW) systems on fishing vessels.

President Dr. Mohamed Muizzu presided over a ceremony today to present award letters to the recipients of the Murabaha RSW Financing Facility.

This initiative, a collaboration between the Ministry of Finance, Ministry of Fisheries and Ocean Resources, Islamic Development Bank (ISDB), and the SME Development Finance Corporation (SDFC), offers Murabaha financing contracts to purchase the RSW systems, as well as complementary solar panels and generators.

“This is a very important policy of the President to increase the economic profitability of the fishing industry by bringing the fish fresh to the port for high profit,” said the President’s office in a statement.

The RSW systems, which use desalinated seawater to produce ice on the boats, allow fishermen to keep their catch fresh for longer periods, eliminating the need to source ice from external providers. This, in turn, enables them to remain at sea for extended durations and deliver higher-quality fish to the market.

Under the scheme, the government will cover 35 percent of the financing costs, with the remaining 65 percent available through SDFC’s Murabaha facility. Fishermen can access financing ranging from 100,000 Maldivian Rufiyaa to 2 million Rufiyaa (approximately $6,500 to $130,000) without any mortgage requirements.

This initiative marks a significant step forward in the government’s efforts to modernize the fishing industry and improve the livelihoods of Maldivian fishermen, who play a vital role in the country’s economy.

Murabaha is a type of Islamic financing contract. In a Murabaha transaction, the financier (in this case, the SME Development Finance Corporation) purchases an asset, such as the Refrigerated Sea Water (RSW) system, and then resells it to the customer (the fisherman) at a marked-up price. The customer then pays the financier in installments. This structure allows the transaction to comply with Islamic Sharia principles, which prohibit the charging of interest.