Sheikh Haitham al-Haddad: A Model for “True Islamic Finance”

Sheikh Haitham al-Haddad, of the United Kingdom, has been very active in analysing and critiquing some of the various models for Islamic finance that have appeared in the West.  I recently came across a fatwa from the Sheikh on particular scheme:

In this short fatwa, I would like to identify a scheme that I am confident provides a good model for true Islamic Finance. This scheme is provided by Ansar Housing Ltd. in Manchester ( and it is, so far, the best scheme that I have encountered. Given that Islamic guidelines concerning finance are fulfilled as far as is possible under present UK regulations, we can say confidently that it is an ideal scheme for Islamic home financing. The scheme adopts a unique system of joint ownership that fulfils the aims and objectives of Islamic finance. I urge both Muslims and non-Muslims to study it objectively and thoroughly in order to realise how true Islamic finance deals fairly with all parties to a transaction, both the weaker and the stronger. It is also important to notice how such a scheme ensures that the customer does not bear financial burdens beyond his ability, which is a major factor encouraging the over-indebtedness of so many individuals today. Moreover, this scheme does not link together several contracts nor does it impose obligations upon the customer in such a way that the end result is indistinguishable from an interest-based loan secured on the customer’s home. In conclusion, I would like to encourage Muslims and non-Muslims who dream of building a fair society, free from oppression by debt and its detrimental consequences, to try their best to ensure that schemes such as this are successful.