UK: Shariah - compliant investing

Islamic finance provider alburaq has announced the launch of the UK’s first retail Shariah-compliant alternative to a guaranteed equity bond.

With a minimum investment of £400, the alburaq savings plan offers investors the opportunity to invest in accordance with their faith.

The product also provides savers with easy exposure to potentially unlimited returns linked to shares in major companies with the added comfort of capital protection.

Keith Leach, head of alburaq at ABC International Bank, says, ‘Over the past few years the UK has seen an increase in the availability of Islamic home finance products, but there remain very few options for Muslims wishing to save money in accordance with their religious beliefs. This new account is also an easy way for Muslim savers to gain exposure to the equity markets, in a secure way.

‘While it is considered permissible within Islam for Muslims to own shares, there are restrictions on the types of companies that are considered allowable. The companies must not be over-reliant on debt, nor must they be engaged in activities that conflict with the principles of Shariah. Many of these principles will be similar to those required by non-Muslim ethical investors.’

The savings plan will be offered to investors in partnership with the Bank of Ireland. Savers will be able to deposit funds with the Bank of Ireland for five years in an account structured following the Islamic principles of Wakala.

At maturity savers will receive their initial capital back, together with 100 per cent of any gain in the performance of a basket of 20 shares in global companies selected from the Dow Jones Islamic Titans 100 index.

(what investment)

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Alfalah Consulting - KL: www.alfalahconsulting.com 
Islamic finance consultant: www.ahmad-sanusi-husain.com 
Islamic Investment Malaysia: www.islamic-invest-malaysia.com