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Islamic Finance

UK gets its first Islamic crowdfunder for business financing

LONDON _ A new UK-based Shariah-compliant crowdfunding platform which provides business financing to small and medium sized enterprises (SMEs) launched at the end of June.

Qardus Limited, which connects SMEs to investors, is an appointed representative of Share In Ltd, which is authorised by the Financial Conduct Authority.

Shariah-compliant crowdfunding is not a new concept in the UK, that already has platforms such as property-focused Yielders, but there are none already providing SME business financing. 

“In terms of competition we would be the first to offer an Islamic business financing facility in the UK as the Islamic banks look at much larger ticket sizes,” Hassan Daher, Qardus founder and CEO told Salaam Gateway.

“In the UAE there is Beehive. Other fintechs in the UK such as Funding Circle and Iwoca only offer conventional financing facilities, not Islamic,” he added. In other regions, Kapital Boost, which was founded in 2015, was Asia’s first Islamic P2P crowdfunding platform for SMEs.


Qardus connects SMEs, seeking Shariah-compliant financing solutions of up to £100,000 in working capital, to investors. The platform offers the unsecured financing for a period of up to two years in the form of commodity murabahah.

Mubrahah is an Islamic financial contract whereby one party buys an asset or commodity and then sells it to another party with a mark-up. 

“SMEs need working capital that is fast and affordable,” said Daher. “This is why we are currently using the murabahah contract. We are studying different financing structures like musharakah or mudarabah to provide different financing types later on, however these can be difficult to price competitively because they are more equity-focused.”

The platform is open to investors in the UK and Europe. Investors from outside these geographies would need to contact Qardus directly to discuss their eligibility.

The minimum investment size is £100 and investors can expect over 10% return per annum but capital is at risk, Daher noted. There is currently one company looking for financing listed on the platform. The company, from the pharmaceuticals industry, is seeking £100,000 for inventory purchases, and offering a projected return of 12.15%. 

Qardus charges a fee on financing raised by the borrower, which ranges from 2% to 5% on the entire financing raised on platform.

Based on the current business model, Qardus aims to breakeven within the next eight months, according to Daher.


Qardus’ internal team screens businesses seeking financing via their platform. 

“We source the SMEs on our platform, conduct a Shariah screening of their underlying activities, risk profile them and price the financing facilities accordingly,” said Daher.

Part of the criteria is that the business has to have turnover of around £1 million, be in business for at least three years and be profitable in two out of three years. The business must not also have any county court judgements (CCJs) against it.

As well as being Shariah-compliant, the SME has to be from recession-proof sectors such as pharmaceuticals, food and beverages, and food manufacturing, as businesses in these areas make money during the pandemic, argued Daher.

“We aim to have 150 SMEs across the UK in the first year, first in pharmacy, food, then we’ll consider other sectors like retail, manufacturing,” he said.


The name Qardus derives from the Arabic word for “loan” and includes the word “us”, making it memorable, the CEO noted.

There are four partners at the start-up including Hassan Daher, who is the sole director and majority owner of the business. Daher has over a decade experience in conventional and Islamic finance having worked at top tier advisory firms such as Deloitte. He is a CFA charterholder and holds a PhD in Islamic finance from INCEIF, Malaysia.

To solidify Shariah-credentials, well-known scholar, Mufti Faraz Adam is an advisor to Qardus. He is a UK-based Islamic finance and fintech consultant and Executive Director of the Shariah advisory firm Amanah Advisors.

Qardus is also supported by a team including a senior credit underwriter.

Now up and running, the start-up will look to expand its team. “We are looking to expand by hiring data scientists as well as those that can help us operationally,” said Daher.

Qardus received a combined £400,000 in seed capital from two UK-based venture capital firms UK Start-Funding club and the Founders Factories.

Originally, it approached an undisclosed Islamic VC, but Daher said the terms they offered were not attractive, so they decided to take a different route.


In addition to its marketing efforts, Qardus will look to raise £1.5 million by the end of this year, according to Daher, adding that it may consider VC funding or equity crowdfunding.

Looking ahead, Qardus plans to offer more than peer-to-peer lending.

“Over the next one to three years, we are working on developing our financing API that will allow partners to integrate all the functionality provided by the Qardus platform,” said Daher. 

“We are currently developing credit risk profiling algorithms using financial and alternative data sets that will allow us to predict the risk of these unique SMEs better than anyone else.”

He revealed that they are also working on an Islamic digital challenger bank within the next three to five years that will allow them to take deposits and offer SMEs a wide range of financial services.

The company also plans to enter other markets in the coming years.

“In the short-term we want to cover the entire UK, then we will look at entering Europe and long-term enter Southeast Asia (Malaysia and Indonesia) and the Middle East.”

(Reporting by Hassan Jivraj; Editing by Emmy Abdul Alim

*Correction: Corrections were made throughout the story on September 11 after clarification from Share In that Qardus is not a Peer-to-Peer platform. 

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