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Islamic banking 'set to grow as ethical investment'
02 April 2008
An Islamic bank is hoping to attract non-Muslim customers to its books by positioning itself as an ethical way to invest.
And while there have been little interest in Muslim banking services from outside mainstream Islam as yet, the Islamic Bank of Britain is confident this will change as more people become concerned about where their money is going.
Samir Alamad, a spokesperson for the Islamic Bank of Britain, said that a whole range of investments are forbidden under Sharia law.
"We do not invest in pornography, gambling, alcohol, tobacco or the arms trade. Also, as interest is forbidden in Islam, we do not invest in interest-based investments," he said.
Mr Alamad added that a strong trend towards "ethical consumerism" would benefit his bank.
"It is possible that our firm stances on how we spend our investors' money will contribute to this trend and hopefully influence other organisations. A change is already occurring, with more mainstream banks offering Islamic financial products and services," he commented.
Islamic banking differs from western financial institutions in that it is based on risk sharing between the bank and the customer, and rewards are divided between them.
The Financial Services Authority estimates the Islamic banking industry to be worth around £250 billion worldwide.
