HSBC’s Islamic finance division, HSBC Amanah has added residential leasehold flats to their list of product-linked properties. These will now qualify for Amanah home finance making it easier for Muslims to finance their homes while remaining within the Islamic law of Shariah. This decrees that Muslims must not be linked with any financial service that makes interest. Therefore, to comply with the law the account has no overdraft, debit or credit interest. The minimum balance on the Shariah current account has also been reduced to £250 for both new and existing customers.
The UK head of HSBC Amanah, Amjid Ali said: “Purchasing a leasehold property using a Shariah compliant home purchase scheme is more complicated than using a conventional mortgage. “The bank is effectively sub-letting the property to the customer, which requires permission from the leaseholder prior to completion,” he explained. However, Mr Ali continued: “HSBC Amanah has the expertise to overcome such complexities and works closely with an independent Shariah supervisory committee of world renowned scholars to ensure our products adhere to Shariah law.”