The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.

The Shari’ah alternative

The world’s largest financial services firms are realizing that Muslims would increasingly like to invest through Islamic funds. These are growing in number but have had a rough ride in the global bear market since many of them were heavily invested in technology stocks.

       

MODERN ISLAMIC FINANCE has developed rapidly since its inception in the 1970s. Most of the advances have been in banking, however, and Islamic asset management, which only started to take off in the mid-1990s, remains relatively underdeveloped. Substantial hurdles still inhibit growth but nearly everyone in the market is convinced that it will soon come into its own.


Industry sources estimate that there is $100 billion to $150 billion invested in a Shari'ah (Islamic law)-compliant fashion. This relatively small figure highlights the potential. The world's 1.3 billion Muslims control vastly greater assets. Private assets in the Middle East alone are estimated at $800 billion but most of it is either salted away under mattresses or invested in conventional products.


A huge proportion of Muslims would, however, prefer to invest in Shari'ah compliant products given the opportunity. "There is a lot to be done in this area," says Mohammad Toufic Kanafani, CEO of Noriba Bank, the new Islamic financial services institution started by UBS in September 2002.



You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree