Indeed, according to a 2022 report from an industry-led body, TheCityUK, global Islamic banking assets totalled $2.8 trillion, of which $7.5 billion were UK-based. In Europe (excluding Turkey) the UK made up 85% of total European Islamic banking assets.

Assets under management of global Islamic funds experienced an average annual increase of 13% in the four years leading up to 2021, and by the end of that year, there were 68 Islamic fintechs in Europe, 45 of which were headquartered in the UK.

What is the business potential for Sharia-compliant finance in the UK?

Zeenat Shaffi, senior business development manager, at Nomo, a digital Sharia-compliant bank, believes Britain is in a prime position to attract business from countries in the Gulf Cooperation Council (GCC) – such as United Arab Emirates (UAE), Oman and Bahrain.

“By capitalising on its leading position in the sector, the UK can increase its appeal to people from the GCC – where around nine in 10 people are Muslim,” said Shaffi (pictured). “We want to see policymakers build on the successful expansion of the UK’s leading Islamic finance market.”

Since 2003, the UK government has passed legislation like the 2005 Finance Act, to make the Islamic finance sector as tax efficient as its conventional counterpart. Shaffi acknowledged that Sharia-compliant banking has faced its own challenges in recent years.