Offa, based in Birmingham and London, is launching with a £20 million funding line provided by a Shariah-compliant UK financial services institution.
It is expecting a high demand for what it claims to be the UK’s first Shariah-compliant bridging loan offering and is therefore in advance talks with another Islamic finance firm to secure an additional £100 million of funds.
Indeed, Offa said the UK’s Muslim population was set to grow by 13 million from its current level of 3.4 million and therefore it felt this was a high growth market with a long term future.
To begin with, Offa will provide Shariah-compliant residential and commercial bridging with a maximum finance-to-value (FTV) of 75% and 65% respectively.
However, there are plans to move into refurbishment, stretched development, planning and shared risk ethical finance facility, which is a Shariah-compliant equivalent of a joint venture.
Bilal Ahmed, head of operations at Offa, said: “Shariah-compliant finance is now an established and trusted part of the mainstream UK financial services landscape, used by Muslims and non-Muslims alike.
“With Offa, we’ve set out to extend its reach into bridging and other specialist forms of lending, which are as yet untapped but experiencing significant demand as property investors seek alternatives to the high street.”