Islamic financing takes step forward

Islamic financing takes step forward

It looks as if the Canadian market is making way for Islamic Finance, an issue being explored since earlier this year. Global bankers, politicians and lawyers recently gathered at the Usury Free Association of North America (UFANA) to discuss the issue.

The two-day conference, held in downtown Toronto last week, saw big-name attendees as senior representatives from four of the big five Canadian banks were present, as well as representatives from the Ontario Ministry of Finance and the Federal Ministry of Finance, all of whom are busy preparing internal reports focusing on the potential of this alternative financing.

"Islamic financial products should not present any particular difficulties under Canadian accounting standards," said Guy David, a speaker at the conference representing the Canadian law firm Gowling Lafleur Henderson LLP.

Other attendees present were representatives from the Ontario Division of Federal Trade Commissioner's office as well as Toronto Financial Services Alliance (TFSA) - both of which are also said to be preparing soon-to-be-released reports.

Earlier this year, a report concluded that while Islamic financing would be legal in Canada, the CMHC has no plans to insure Shariah-compliant mortgages. This would open the door to private lenders who would be free to pursue this type of financing. 

 

 

9 Comments
  • M 2010-04-14 6:23:11 AM
    I'm glad that CMHC isn't going to insure this type of mortgage. When in Canada do as Canadians do. If your religion doesn't allow you to pay interest--don't buy a house or better yet--save up your money and buy it cash.
    Post a reply
  • Farooq 2010-04-14 7:27:02 AM
    Islamic Financing is billion dollars of business in the US and UK and its good to see that its coming here in Canada. In the US companies like Guidance Financial have done close to $2 Billion in Islamic mortgages. In the end trade is permitted and the financing is on a trade basis to get around Islamic usury law. If we allow people to eat halal and kosher meat at products there should be no reason why they can't have compliant financing products.
    Post a reply
  • Daud Ahmed 2010-04-14 8:03:59 AM
    Didn't all Abrahamic religions ban Usury? Jews don't charge interest to other jews, but can to a 'stranger', christians have 'jumped right in' and look at the mess it's caused to the entire financial system. Even the pope recognized Islamic Finance as a solution. Why is Islam still the only one to maintain its stance on social justice ? Where usury oppresses people into submission, a Profit/ Loss system spreads the risk to all parties. Let's do our homework and be better informed.
    Post a reply