| Operational risks in Islamic banking under the digital environment |
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Author: Svetlana S. Galazova North Ossetian State University named after K. L. Khetagurov, Vladikavkaz, Russia Leila R. Magomaeva Grozny State Oil Technical University, Grozny, Russia Georgy N. Kutsuri Financial University under the Government of the Russian Federation, Moscow, Russia Uzan M. Iskakov Narxoz University, Almaty, Kazakhstan Olga M. Razina ANO VO Institute of Social Sciences, Moscow, Russia Abstract: The financial technology advancement makes it strictly necessary to account for digital factors in the functioning of the Islamic banking sector with a view to maintain the competitiveness of Islamic banking institutions. The paper aims to study scientific-practical and methodological problems of the operational risk regulation in Islamic banking under the digital environment. The methodological basis of the research consists of the theory of innovation and theoretical principles of Islamic finance. The central method is the analysis of regulatory practices and standardised procedures for assessing capital adequacy. The evidence base includes data from analytical reports, reports of Islamic financial institutions and information from the MIT AI Risk Repository. The paper studies the non-linear model for the operational risk assessment, which is oriented towards distributing regulatory burden on a progressive scale for the operational risk events with low frequency and high impact, which possess the greatest destabilisation potential. The findings may help refine the regulatory requirements, develop risk scenarios, and put forward scientifically grounded propositions about the modernisation of national standards, which thuswise will be able to meet the challenges posed by the digital environment. In addition, they may be useful for Russian banks that participate in the experiment of the Central Bank of Russia on introducing partnership financing. Keywords: Islamic financial institutions; operational risk; cyber risk; digital incidents; non-linear model; innovations; macroprudential regulation. For citation: Galazova S. S., Magomaeva L. R., Kutsuri G. N., Iskakov U. M., Razina O. M. (2026). Operational risks in Islamic banking under the digital environment. Journal of New Economy, vol. 27, no. 2, pp. 76–91. DOI: 10.29141/2658-5081-2026-27-2-4. EDN: OZPDCW. Article info: received October 23, 2025; received in revised form December 2, 2025; accepted March 20, 2026 |
