UK leads the way in Sharia-compliant finance

BRITAIN is the leading centre for Islamic finance among Western countries, according to a new report.

The study by TheCityUK reveals that the UK is the fourth most significant centre for Islamic finance among non-Muslim-majority nations after Singapore, Sri Lanka and South Africa.

The report, Global Trends in Islamic Finance and the UK Market, shows that globally the market for services in the sector increased 7.5% year on year in 2015 to a record $2 trillion worldwide.

In Britain, TheCityUK estimates that assets of UK-based financial institutions offering Islamic finance services totalled more than $5bn in 2016. Over 20 banks across the country offer Islamic finance services – more than double the number located in the US – five of which are fully Sharia-compliant.

The UK has become the leading centre of Islamic finance education and training globally. It is also increasingly a centre of innovation and development for the use of fintech in Islamic finance products.

Miles Celic, CEO of TheCityUK, said, “The Islamic finance sector is a rapidly expanding part of the global financial system. Currently, Sharia compliant assets make up just 1% of global financial assets, yet around one in four of the world population is Muslim. There is enormous potential for further growth.

“Given the UK’s position as a world leader in innovation and development within the sector, we’re well-placed to capture this opportunity.”

He added: “Infrastructure development is a key area where greater use of Islamic finance instruments could be encouraged.

A number of significant projects in the UK, including the Shard, Battersea Power Station regeneration and the Olympic Village in London, and over 6,500 new homes in the NorthWest and Midlands, have seen Islamic finance play a significant funding role.