Gatehouse Bank has published a report outlining four key recommendations for the Government to unlock further growth by levelling the playing field between Islamic and conventional finance.
The report, which was presented this morning at an event at the House of Lords, highlights the significant global growth projection for Islamic finance – from £140bn in 2003 to £3.2tn by 2030.
In the UK, this is complemented by strong consumer demand, as previous research by Gatehouse Bank found that just under nine in 10 (88%) UK consumers of the Muslim faith and three in 10 (30%) UK consumers not of the Muslim faith, would consider switching to an Islamic finance provider.
Drawing on lessons from comparable markets in Africa, Australia, Canada, the EU, the UAE and the US, the report made four key recommendations.
Firstly, the bank has urged the Government to establish a Government-led Islamic finance taskforce to identify areas of growth, including facilitating inward investment and attracting international investors seeking alternative sustainable options.
In addition, the report outlined was in which the Government should help attract new Islamic finance entrants by removing barriers and disadvantages compared to conventional finance, such as increasing the Bank of England’s Alternative Liquidity Facility.
Gatehouse also called on the Government to develop a cohesive strategy on Islamic finance, to level the playing field and ensure alternative finance structures are considered when formulating policy and proposing new legislation, and to help foster global collaboration on Islamic fintech to fuel the already strong UK market and enable it to grow.
Charles Haresnape, CEO of Gatehouse Bank, said: “Our research shows that the UK is already well-placed to become the Western capital for Islamic finance.
“However, achieving that goal requires a government commitment to placing alternative finance, including Islamic and ethical finance, on a level playing field with conventional finance.”
He added: “The development of Islamic finance is not just a niche within the UK’s financial services sector – it is a marker of the country’s ability to foster ethical innovation and inclusive growth.
“Ultimately, strengthening the UK’s Islamic finance sector will attract international investment and enhance financial inclusion, ultimately driving innovation and competitiveness in the wider financial services sector.”
