Gatehouse Bank has published a report that outlines recommendations for the Government to unlock growth by "levelling the playing field" between Islamic and conventional finance.
The report, which has been presented to the House of Lords, highlights a global growth projection for Islamic finance, from £140bn in 2003 to £3.2trn by 2030.
The Shariah-compliant UK challenger bank previously found that 88% of UK consumers of the Muslim faith and 30% of 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 makes four key recommendations, including the establishment of a Government-led Islamic finance taskforce to identify areas of growth, as well as attract new Islamic finance entrants.
The other recommendations suggested by Gatehouse Bank include the development of a cohesive UK Government strategy on Islamic finance and the fostering of global collaboration on Islamic fintech.
The bank stated that the Islamic finance market is projected to grow by 16.5% over the next five years, rising from £6.1bn in 2024 to an estimated £7bn in 2029.
Currently, Britain has over 20 institutions, including five fully Shariah-compliant banks, now providing Islamic finance products, which is more than any other western nation.
Chief executive officer at Gatehouse Bank, Charles Haresnape, 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.
"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."
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