Islamic mortgages 'should be offered separately'

Islamic mortgages and other financial products and services cannot be fully integrated into the mainstream finance arena, according to one industry observer.

John Willsdon, learning and development specialist of the Chartered Institute of Management Accountants, said that while Islamic and traditional financial services should operate "side by side" but remain separate.

He explained that legitimate Islamic financial institutions need to be compliant with Shari''ah law, which goes against the fundamentals of the conventional finance industry.

"The two key aspects of compliance [with Shari''ah law] relating to the finance industry is that you can''t charge or give interest and you should avoid uncertainty," Mr Willsdon explained.

These "prohibited factors" are what the traditional finance industry is built on, he added.

Mr Willsdon concluded that as a result, conventional financial institutions need to offer Islamic mortgages and other financial products "completely separated" from its other products.

Last month, the Financial Services Authority said the Islamic finance industry is worth some £250 billion across the globe.

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