Final 12 months, we printed an version of Finovate World that featured new developments in Islamic finance. This week’s column will discover additional the world of Islamic and Shariah-compliant monetary companies with Dilshod Jumaniyazov, CEO and co-founder of Musaffa.
Launched in 2020 and headquartered in New York, Musaffa presents a complete platform for moral investing, Halal inventory buying and selling, and monetary schooling. Greater than 487,000 Muslim buyers in 195 international locations use Musaffa’s platform, which offers entry to shares in international locations starting from the U.S., U.Ok., and Australia to Malaysia, the UAE, and Turkey.
Musaffa just lately launched its Purification Calculator, which allows Muslim buyers to confidently establish and spend money on Shariah-compliant companies. And at a time when extra buyers are on the lookout for investments that align with their values, Musaffa’s superior screening instruments, monetary schooling, and different options might be helpful to ESG-oriented buyers in addition to faith-based ones.
In our prolonged dialog, Jumaniyazov helps us perceive the scale and scope of Islamic and Shariah-compliant finance, the distinctive wants of the shoppers on this rising market, and the way enabling applied sciences are bringing innovation to Islamic monetary companies in areas resembling banking to wealth administration.
How huge is the marketplace for Shariah-compliant monetary options? How has this market grown within the West specifically? Are there international locations within the West the place the demand for Shariah-compliant monetary options is particularly sturdy?
Dilshod Jumaniyazov: The marketplace for Shariah-compliant monetary options isn’t just huge—it’s rising quick. In 2022, the worldwide Islamic finance trade expanded by 11%, reaching $4.5 trillion in property, and it’s anticipated to develop to $6.7 trillion by 2027, in line with the ICD-LSEG Islamic Finance Growth Report 2023.
Within the West, Islamic finance has gained vital traction, significantly because the 2008 monetary disaster, when it emerged as a extra steady and moral different. Within the U.Ok., Islamic banks have doubled their property over the previous decade, reflecting a rising demand for Islamic finance. Sukuk issuances have additionally elevated throughout Europe, with international locations like Luxembourg and Germany main the cost. The broader development of sustainable and values-based investing has performed an important position in driving this progress.
Sure Western international locations stand out for his or her sturdy demand. Based on World Finance Journal, the U.Ok. is a transparent chief, serving as a world hub with 5 Islamic banks and greater than 20 standard banks providing Shariah-compliant merchandise. Luxembourg, the primary Eurozone nation to situation a sovereign sukuk, hosts a variety of Shariah-compliant funds. Germany has made vital strides by issuing sukuks and licensing its first Islamic financial institution, highlighting its rising curiosity within the sector. In the meantime, France, with Europe’s largest Muslim inhabitants, holds monumental untapped potential regardless of its comparatively underdeveloped Islamic finance market.
This mix of moral investing and rising demand in key areas has positioned the West as an rising drive in Shariah-compliant finance.
What are we speaking about once we discuss Shariah-compliant finance? How is it totally different from financing within the West?
Jumaniyazov: Shariah-compliant finance is rooted in Islamic rules that emphasize equity, transparency, and social accountability. It prohibits incomes or charging curiosity (riba), extreme hypothesis (gharar), and investments in dangerous industries resembling playing, alcohol, and weapons. As a substitute, it focuses on moral investing, risk-sharing, and linking all monetary transactions to actual financial actions. For instance, fairly than counting on conventional interest-based loans, Shariah-compliant finance makes use of fashions like mudarabah (profit-sharing) and musharakah (joint ventures), the place dangers and rewards are shared amongst all events. This method ensures that monetary actions create tangible worth and profit society.
What units Shariah-compliant finance other than Western finance is its deeply embedded moral framework. Whereas Western finance typically revolves round interest-bearing loans and speculative investments, Shariah-compliant finance requires each transaction to align with ethical rules and financial justice. It’s not nearly revenue — it’s about creating shared prosperity and avoiding hurt. This deal with fairness, accountability, and real-world affect makes Shariah-compliant finance a compelling different, particularly for these in search of a extra values-driven method to managing wealth.
How has digital transformation impacted the marketplace for Shariah-compliant finance. Has know-how made it simpler to innovate and create new options for the neighborhood?
Jumaniyazov: Digital transformation has fully reshaped the panorama of Shariah-compliant finance, making it extra accessible and revolutionary than ever earlier than. With the rise of digital banking and cellular cost platforms tailor-made to the wants of Muslim shoppers, monetary companies at the moment are reaching communities that have been beforehand underserved. This has opened up alternatives for progress and inclusion on a world scale.
Expertise has additionally sparked thrilling developments like digital sukuks and blockchain-based sensible contracts, which align completely with Islamic rules. These improvements haven’t solely made processes extra environment friendly, however have additionally launched totally new methods to method halal and moral finance. By breaking down limitations and decreasing prices, digital transformation has turned Shariah-compliant finance right into a dynamic, forward-thinking sector that’s extra related than ever in at this time’s world.
Is there a job for AI in Shariah-compliant finance?
Jumaniyazov: AI is revolutionizing Islamic finance by making it extra environment friendly, revolutionary, and accessible whereas staying true to its moral rules. One in all its most vital contributions is in screening shares and ETFs for Shariah compliance. AI can analyze massive datasets to evaluate whether or not investments meet Islamic standards, streamlining a course of that may in any other case be time-intensive and complicated. This ensures that buyers can confidently align their portfolios with their religion.
AI can also be reworking Islamic monetary merchandise, resembling sukuk. By enabling sensible contracts, it has improved the transparency, effectivity, and trustworthiness of sukuk issuances. With purposes like blockchain integration and superior analytics, AI isn’t just addressing operational challenges but in addition opening doorways for innovation, making Islamic finance extra dynamic and globally related whereas adhering to Shariah rules.
You might be CEO of Musaffa, an organization that has developed Shariah-compliant options. Are you able to inform us slightly about Musaffa and the way you got here to co-found the corporate?
Jumaniyazov: After all. The journey to founding Musaffa started with a deeply private problem. Over my 16 years of investing, I typically confronted a dilemma — questioning whether or not my investments aligned with my religion and values as a Muslim. Each time I ventured into the inventory market, I carried the load of uncertainty, questioning if I used to be compromising my rules. As I shared my experiences with pals and colleagues, I noticed this was not simply my battle — it was a problem confronted by hundreds of thousands of Muslims worldwide in a monetary panorama that supplied little steering or transparency for faith-aligned investing.
This realization sparked a imaginative and prescient over a decade in the past: to create a platform that may empower Muslims globally to speculate ethically and confidently whereas staying true to their religion. Nevertheless, I shortly acknowledged that making this imaginative and prescient a actuality required extra than simply ambition. It demanded deeper information, broader expertise, and substantial capital.
Decided to bridge these gaps, I pursued an MBA on the College of Illinois at Urbana-Champaign and earned my CFA designation to strengthen my experience in finance. I gained invaluable expertise working with the know-how workforce at Wells Fargo Securities, the place I contributed to launching a number of buying and selling platforms. Alongside this, I saved diligently, setting apart funds from my paychecks and 401(ok) financial savings over time. By late 2020, with $250,000 of my very own financial savings, I used to be able to convey Musaffa to life.
Musaffa is greater than only a platform — it’s an answer to a deeply felt drawback. At its core, Musaffa offers entry to over 90,000 shares and 9,000 ETFs globally, all meticulously analyzed for Shariah compliance. The platform allows customers to seamlessly purchase and promote halal shares by means of an built-in community of brokerages.
Training is one other cornerstone of our mission. By Musaffa Academy, we provide tailor-made programs in monetary literacy and Islamic finance, equipping our customers with the information to make knowledgeable choices. These instruments are designed not simply to assist Muslims make investments, but in addition to empower them to know and take management of their monetary journeys.
Because of this, Musaffa has grown to serve over 482,000 customers throughout 195 international locations. Our customers belief us to offer peace of thoughts and a method to align their investments with their religion. With options like superior Shariah compliance screening, built-in buying and selling choices, and a sturdy instructional platform, Musaffa has develop into a trusted accomplice for Muslim buyers worldwide.
Wanting forward, we’re excited to develop our choices by launching proprietary Shariah-compliant ETFs and additional integrating into international markets. Our aim is to make halal investing much more accessible and to proceed simplifying entry to the $30 trillion Shariah-compliant market.
What units Musaffa aside are usually not simply the instruments we offer however our unwavering dedication to fixing actual challenges. We’re not simply providing a platform; we’re creating a world monetary ecosystem rooted in religion, belief, and ethics.
At the moment, I’m extremely pleased with how far Musaffa has come. It stands as a testomony to years of dedication, the assumption that monetary success ought to by no means come on the expense of 1’s values, and a imaginative and prescient that’s empowering Muslims world wide to speculate with confidence and function.
Who’re Musaffa’s major prospects and the way do you attain them?
Jumaniyazov: Musaffa’s major prospects are particular person buyers worldwide who search to spend money on alignment with their values, in addition to each Islamic and conventional monetary establishments. We have interaction with them by means of a strategic mixture of focused digital campaigns, partnerships with Islamic organizations, and our strong schooling platform, Musaffa Academy, which drives nearly all of our visitors. Moreover, we leverage the Musaffa Ambassador Program, which empowers passionate people to characterize our model and convey extra customers to the platform. Phrase-of-mouth referrals additionally play a pivotal position in constructing belief and increasing our attain inside this values-driven viewers. Collectively, these channels foster a robust and genuine reference to our prospects.
You latterly launched a Purification Calculator? Are you able to inform us about this answer: why you launched it, what it does, and the way the reception of it has been to this point?
Jumaniyazov: The Purification Calculator is an indispensable device designed to make sure that Muslim buyers can preserve Shariah compliance of their investments. Purification is a compulsory situation for any funding to be thought-about Shariah-compliant, because it entails cleaning portfolios of any unintended non-compliant earnings. The calculator simplifies this course of by figuring out the precise quantity that must be donated to charity, enabling buyers to align their earnings with Islamic rules.
We launched this answer to handle a essential concern for Muslim buyers and to simplify a course of that many discovered complicated or unsure. The suggestions has been overwhelmingly optimistic, because the device empowers customers to speculate with confidence, figuring out their monetary actions align with each their religion and values.
What are among the most fascinating issues happening in Islamic finance proper now to you personally?
Jumaniyazov: For me, probably the most thrilling developments in Islamic finance is the rising deal with halal funding analysis. With extra Muslims desirous to align their monetary choices with their religion, the demand for instruments and analyses to establish Shariah-compliant alternatives is stronger than ever. This isn’t nearly screening shares; it’s about offering in-depth analysis and actionable insights that assist buyers make assured, knowledgeable choices in a fancy market.
One other space I discover fascinating is how digital platforms are reworking entry to halal investments. From sukuk to Shariah-compliant ETFs and shares, know-how is making it simpler for individuals to search out and spend money on Shariah-compliant and moral property. This mix of analysis and innovation is bridging a essential hole for Muslim buyers, serving to them develop their wealth whereas staying true to their values; it’s an thrilling time to see how the trade is evolving to satisfy each faith-driven and monetary wants.
What can we anticipate to listen to from Musaffa in 2025?
Jumaniyazov: In 2025, at Musaffa, we plan to launch a complete Islamic finance schooling platform, introduce our proprietary Shariah-compliant buying and selling platform, and start providing unique Shariah-compliant ETFs following SEC licensing approval. Our aim is to solidify our place because the premier international platform for halal investments whereas considerably increasing our consumer base.
Right here is our have a look at fintech innovation world wide.
Central and Southern Asia
Latin America and the Caribbean
Blockchain and cryptocurrency infrastructure firm Binance gained approval from the Central Financial institution of Brazil to accumulate a regionally licensed broker-dealer.
Union Financial institution of India launched new accessibility options to its Digital Rupee app.
Chilean fintech Tanner Servicios Financieros raised $40 million in funding from the Worldwide Finance Company.
Asia-Pacific
Sub-Saharan Africa
South African fintech Sourcefin raised $8.2 million in funding to help SME financing.
Monetary companies supplier Mukuru secured a Deposit-Taking Microfinance Establishment (DTMFI) license in Zimbabwe.
Nigeria-based Bankit MFB launched its new internet banking platform.
Central and Jap Europe
Digital asset infrastructure firm Taurus expanded its operations in Turkey.
Serbian IT firm Saga teamed up with Salt Edge to assist banks in Serbia benefit from alternatives in open banking.
German fintech Cleversoft introduced its intention to accumulate Turkish monetary messaging and AML compliance options supplier Fineksus.
Center East and Northern Africa
Qatar-based Doha Financial institution to go dwell with Visa Industrial Pay, the primary financial institution out there to take action.
Iraqi fintech firm Qi Card launched its app SuperQi, which serves as each a life-style tremendous app and a digital financial institution.
Italian software program firm TeamSystem acquired Israeli fintech Morning for $150 million.
Fascinated with demoing at FinovateEurope 2025 in London? Functions are nonetheless being accepted from revolutionary corporations with new options which are prepared to indicate. Go to our FinovateEurope hub at this time to study extra.
Picture by Aa Dil
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