Alex Junaid | Since its foundation in the seventh century, the Islamic faith has spread across the globe, with more than 1.8bn adherents today. In 2018, there were 3.4m Muslims in the UK, making up 5 per cent of the population. The Pew Research Center, an American think-tank, predicts that by 2050 this figure will have climbed to just over 13m, or 16.7 per cent of the UK population. They will need access to financial products that adhere to Islamic standards.
Islamic finance is not fiendishly complicated to grasp, but it does require knowledge of the principles that underpin the religion. Those who follow Islam observe “peace and submission to Allah”, as the word translates. The religion sits upon three legal foundations: aqidah (beliefs), akhlaq (morals) and shariah (duties).
This third pillar governs a person’s interactions with God (ibadah), and his/her interactions with others (muamalat ammah), which includes finance. Non-Muslims may be familiar with a handful of rules from this last sub-category, with regards to food, marriage and family. Less familiar, however, is the notion of shariah-compliant finance.
According to clerics and Islamic finance experts, this lack of familiarity even extends to followers of the faith. “Muslims believe that Islam gave them a financial system to operate and to apply it to their financial matters,” says Qari Asim, an imam at Leeds’ Makkah mosque. But that doesn’t always equate to deed, or even much discussion. “There isn’t a huge emphasis in this country to talk about sharia compliance in financial matters,” adds Mr Asim.
In fact, in the UK, shariah-compliant product provision is scarce, demand is low and understanding is meagre among the general Muslim population, according to Islamic finance experts and religious leaders alike. It falls upon Islamic scholars to interpret the scriptures, and finance professionals are expected to follow. This can create tension, and at times Islamic finance amounts to a theological battle between religious experts. As such, it is hard not to sympathise with rank-and-file believers who want to observe these rules with ease, much as they do when they consume halal food.