Financing for Muslims is desperately difficult to find. An estimated 2.78 million UK Muslims are unable to benefit from the increasingly popular peer-to-peer lending market, and many Muslim businesses, 13,400 of them in London alone, are unable to access conventional financing as it would jeopardise their beliefs and values.
We intend to open up the lending market for Muslims by allowing borrowers to secure Sharia compliant financing directly from their peers for the first time in the UK. Peer to Peer lending dramatically reduces the cost, complexity and time often associated with conventional finance methods for borrowers, whilst at the same time dramatically increasing the returns on investment for lenders in comparison to traditional saving models. All without compromising the beliefs and values of faith.
Our platform will directly connect creditworthy businesses (the borrowers) looking for funding with investors (the lenders) looking to support their growth.
We process this request through a Commodity Murabaha (cost plus profit) agreement, where rather than giving the borrower money at a profit (interest), they are sold commodities at an agreed profit rate and differed payment term. The borrower than sells the commodities in the open market to monetise its value.
How it works
A business applies and requests finance
We check the business’ financials and credit rating with external providers
An approved business is released to the marketplace with financials, credit rating and a brief
Funding opens for a fixed period, allowing potential investors to commit funds
Lenders fund the full finance request
The business accepts offer to purchase commodity with aggregated profit-margin achieved in the funding
We acquire real commodity on behalf of successful lenders
We sell the commodity to the business for the value of the initial finance request + lenders aggregated profit margin on a deferred monthly payment plan
The business takes ownership and sells the commodity in the open market to instantly monetise its value
Lenders receive monthly payments from the business which includes the initial investment plus profit over the repayment term
