Nester has around £17m worth of loans in the pipeline after launching to all investors in April, as the demand for Islamic finance rises.
As the first directly authorised Shariah-compliant peer-to-peer lending platform, Nester provides buy-to-let, refurbishment and bridge financing for corporates and offers investors returns of up to nine per cent, secured on UK property.
The platform received direct approval from the Financial Conduct Authority in February last year and did its first deal in April 2021. It then tested its systems and processes before embarking on a soft launch in December 2021.
Founder and chief executive Youness Abidou said the platform has completed £5m in real estate deals and raised £1.2m from investors. Under its Shariah-compliant business model, pre-funders invest in deals and then sel these investments onto the marketplace.
Abidou said the platform has a strong pipeline of 12 transactions, worth £17m, which it expects to close in the next six to eight weeks.
He added that in July, Nester is planning to launch an investor app which will have all the features that lenders can currently access on their account online.
Read more: Nester lobbies HMRC on IFISA rules
“We’ve faced tremendous demand,” Abidou said.
“There’s evident pent-up demand for Shariah products, both financing requirements for borrowers – who we call our buyers – and also the demand for our product from investors. We’ve raised £1.2m from investors through word of mouth with no active marketing.
“We’re very pleasantly surprised at the take-up from the Muslim community, but that said we’re an agnostic platform, we’re about empowerment and financial inclusivity.
“I think there is increasing demand for Islamic finance, there is more activity in the marketplace, there are more players within the fintech space and they are better players than there has been in the past.
“Islamic finance will grow. It needs to be sustained with investment and entrepreneurs driving new business, they need to be resolute in pushing it forward.”