Awareness surrounding Islamic finance has increased among Muslim consumers in the UK, new research by Gatehouse Bank has indicated.

Findings published by the Shariah-compliant UK challenger bank revealed that awareness among this group has grown from 77% in 2019 to 90% now.

Gatehouse also found that 30% of respondents who do not follow the Muslim faith have at least some knowledge of Islamic finance.

The research revealed a generational gap in terms of awareness of Islamic finance. Consumers aged between 18 and 24 years old were the most familiar with Islamic finance, with over eight in 10 (83%) having at least some knowledge of the sector. This marked a substantial increase since 2019, where only a quarter (25%) of 18 to 24-year-olds were aware of Islamic finance, making them the least familiar age group at the time.

Comparatively, 44% of 45 to 54-year-olds and just over a quarter (26%) of over-55s claimed to have at least some knowledge of the sector.

Gatehouse Bank CEO, Charles Haresnape, commented: “The familiarity with ethical and green finance among UK consumers of the Muslim faith reflects the interconnectedness of Shariah principles, community support and environmental stewardship.

“In turn, this presents a unique opportunity for financial institutions to cater to an increasingly conscientious market.”

However, Gatehouse said its research also highlighted “lingering misconceptions” around Islamic finance, with 35% of non-Muslim respondents and 26% of Muslim respondents believing that Shariah-compliant finance is only available to those of the Muslim faith.

The research also revealed untapped opportunities in the market, as just over half (51%) of consumers who follow the Muslim faith have never taken out a home purchase plan and two fifths (41%) have never used Islamic savings accounts.

Haresnape added: “The research still underscores a critical gap in accessibility and education around Islamic finance for consumers from other faiths or from non-faith backgrounds.

“By addressing these barriers and misconceptions, we can unlock significant potential for even more growth in the Islamic and ethical finance sector, making sustainable financial products available to a much wider audience.”

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