Readers who click on the link below will note that the article doesn’t reflect the headline that we’ve posted here, but there is a valid reason for that.
As is often the case with Shariah-compliant finance, the real story is often found by reading between the lines.
In the article below published in Qatar, which, by the way, has no independent media, it is claimed that Standard & Poor’s has declared that the “extra costs” associated with Shariah-compliance are shrinking.
That may or may not be true.
But what is surely news is the fact that S&P and Islamic media even acknowledge the extra costs associated with Shariah-compliance in the first place. We’ve pointed it out on SFW for years, but no where in the prospectus of any Shariah-compliant mutual fund or the literature associated with other Shariah-compliant financial products will you find any advisory of the increased fees and costs that are inherent with Shariah-compliant finance and banking.
So, at least this is an admission of sorts…Moreover, given that this article is dedicated to banking, it debunks the myth that Shariah-compliant loans and mortgages are “interest free.” They may not charge “interest,” but they most assuredly charge fees for lending money and those fees typically are greater than conventional interest charges…