An Islamic peer-to-peer lending platform has launched in the UK, providing Shariah-compliant finance to small- and medium-sized enterprises (SMEs).
Salaam Gateway reported that Qardus, which is an appointed representative of Financial Conduct Authority-regulated ShareIn, provides unsecured loans of up to £100,000 in the form of a commodity murabahah, an Islamic financing structure in which the seller and buyer agree to the cost and mark-up of an asset.
The platform, which is open to both Muslim and non-Muslim investors in the UK and Europe, has a minimum investment of £100 and offers target returns of 10 per cent per annum.
Qardus charges a fee for borrowers, ranging from two to five per cent on the total financing raised on platform.
The borrower must be in business for at least three years, have a minimum turnover or assets of £100,000, not have any county court judgements against it and be in so called recession-proof sectors such as pharmaceuticals, food and beverages and food manufacturing.
Currently, Qardus has a pharmaceutical company listed on the platform looking for £100,000 for inventory purchases, offering a projected return of 12.15 per cent per annum.
“We are really pleased to have launched Qardus this month in the UK,” founder and chief executive Hassan Daher told Peer2Peer Finance News.
“We believe that our platform provides business financing to a currently underserved market of SMEs unable to obtain funding due to a lack of financing options that align with their ethics and values.
“We also offer social impact investors a chance to generate returns in an ethical manner.”
Qardus aims to break even within the next eight months, based on its current business model, and will look to raise £1.5m by the end of this year.
The platform is developing credit risk profiling algorithms using financial and alternative data sets in order to better predict the risk of unique SMEs.
Qardus is also working on an Islamic digital challenger bank within the next three to five years.
It plans to expand into Europe in the short-term, with a view to entering new markets such as Malaysia, Indonesia and the Middle East in the future.
Last year, European alternative lender Robocash Group entered the Islamic finance market by partnering with a Shariah-compliant firm in Indonesia.