Qardus: Understanding

Fair play

Understanding Islamic finance

QHassan Daher Founder & CEO Qardus D ue to a lack of Sharia-compliant financing alternatives, UK Muslim business owners often resort to raising finance through equity or reinvestingprofits to fund growth. However, this situation is changing. Step forward NACFB Patron, Qardus; the first ethical and Sharia-compliant business & financing platform for SMEs in the UK. We asked founder and CEO Hassan Daher to explain more.

What is Islamic finance?

Islamic finance offers an alternative are allowed under Sharia law. These activities must be linked to a real economic transaction, and often involve entering into sales, leasing and partnership arrangements with their clients to meet their funding requirements.

Is Islamic finance only available to Muslims?

No. Islamic finance is available to all enterprises and people irrespective of faith or background.

Do brokers have to be Muslim to introduce business to Qardus?

No. Any NACFB broker can register and get in touch with us directly or via our website to learn more about our referral criteria.

How much does Qardus typically lend and for how long?

We offer business finance from £50,000 to £200,000 with terms starting from six to 36 months. Our facility requires a personal guarantee with no other security required. This means our SMEs can receive financing more quickly and easily without the need to have fixed assets to offer as collateral. In an asset-light, service economy like the UK, the requirement to have tangible fixed assets in the business can create a barrier to growth for SMEs. A How has the pandemic affected Qardus’ lending programme? We launched during the pandemic in July 2020, which was to our advantage because as a fintech company, we were able to quickly adjust our credit criteria and streamline our processes to make them more robust to cope with the economic conditions. How do you see the future of Islamic financing in the UK? In the UK, the British Muslim community is massively underserved, especially when it comes to business financing options for SMEs. We feel Islamic finance is just getting started approach to finance based on the principles of Islam. A core principle of

Islamic finance is that the payment and receiving of interest is prohibited. Another core principle is that financial activities should not cause any harm. Islamic finance is therefore strongly aligned with ethical and sustainable business practices often referred to as environmental, social and governance (ESG).

If the lender doesn’t charge interest, how does it make money?

Instead of charging interest, financial institutions make money by generating profits using various contracts that

What types of SMEs will you finance?

We finance all UK SMEs across various sectors that meet the following eligibility criteria: limited liability company with UK registration; minimum two years’ trading history; no outstanding CCJs; and stable cashflow. Non-Sharia compliant business activities are excluded such as conventional finance (non-Islamic banking, finance and insurance, etc), alcohol, pork-related products, non-halal food production, packaging and processing, entertainment (casinos, gambling and pornography), as well as tobacco, weapons, arms and defence manufacturing. and are optimistic going forwards due to the economic recovery.

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