The paper outlines the social and economic reasons, and sets out how regulation has been an important factor, for the growth of Islamic financial products and services in the UK. The paper also identifies some of the challenges and opportunities specific to Islamic finance.
The Financial Services Authority (FSA) has encouraged this growth by providing an open and flexible regulatory environment, which accommodates both Islamic and non-Islamic financial institutions.
Callum McCarthy, chairman of FSA, said: Islamic finance is a fast growing force in the world economy and the FSA’s open and principle-based approach to regulation offers the right environment for it to flourish in the UK. There is huge potential for an expansion of Islamic offerings in the UK’s financial markets, which will in turn boost London’s position as an international financial centre.
We believe in a ‘no obstacles, no special favors’ approach when authorizing new financial institutions and welcome the development of this market as it provides certain UK consumers with financial products that are in line with their beliefs.
