Sharia-compliant mortgage lender in receivership

The Toronto Star – October 18, 2011

UM Financial Inc., a Toronto-based firm that offered sharia-compliant mortgages to Muslims, has gone into receivership leaving more than 173 people fearful they may lose their homes. UM Financial was one of the first companies in Canada to offer so-called Islamic financing to Muslims who believe that sharia, or Islamic law, prohibitions against usury include interest on things such as mortgages. UM would buy a property then lease it to a client so they were paying rent instead of interest. Some homeowners complained that the firm would also charge extra fees. The company had $50 million in financial backing from Central 1 Credit Union of which almost $29 million is outstanding.

First Sharia-Compliant Exchange-Traded Fund Available Soon in Canada

Islamic financial services company UM Financial Inc. and Jovian Capital Corp. hope to list Canada´s first sharia-compliant exchange-traded fund (EFT) in the next week. In compliance with Islamic law, the index avoids firms involved in financial services alcohol, gambling and pork products. It would target Canada´s growing Muslim population (approximately one million) as well as foreign investors. In recent years, sharia-compliant EFTs have emerged in Britain, India, Singapore, Dubai, Malaysia and South Africa.