Mobiquity has launched the Islamic banking minimal viable product (MVP) at fintech conference Money20/20 in Europe.
The new Islamic banking technology prototype will allow Australian financial institutions to plug in and provide personalised Islamic services to their customers, across savings and transactions accounts, and lending.
Islamic finance is based on a belief that money should not have any value itself, with transactions within an Islamic banking system needing to be compliant with Shariah (the laws that form part of the Islamic tradition).
Sharia law prohibits interest from being paid or earned, to avoid profit being made, meaning that traditional loan products may not be an option for Muslim borrowers.
Mobiquity noted that currently the Australian Muslim community is growing, with around 1.2 million people.
There is reported demand for financial services that accommodate their religious beliefs, with one in three Australian Muslims admitting to keeping significant cash savings at home because of a lack of options and to avoid earning interest.
Gustavo Quiroga, APAC general manager at Mobiquity added that research had also shown almost half of Aussie Muslims who had taken out a mortgage with a traditional bank were reluctant to do so, as the interest earnings ran contrary to their beliefs.
“There’s now an opportunity to use our Islamic banking to extend culturally ethical banking services that delight and exceed expectations of customers,” Mr Quiroga said.
“Our team is beyond excited to grow our services in this space and partner with like-minded financial institutions who see the value in investing in such ethical practices.”
On a global scale, there are around 1.9 billion Muslims, with the Islamic fintech market tipped to reach $220 billion by 2025. Mobiquity noted the APAC region in particular will be a focus due to its growing Muslim population.
Matthew Williamson, vice-president of global financial services at Mobiquity, commented the opportunity is ripe for the taking with an emerging generation seeking banking solutions that meet their religious beliefs.
“The future of Islamic finance is disrupting financial models as more people, particularly in the younger generation, seek banking solutions that meet religious needs and encourage an ecosystem of fair, ethical and moral responsibility,” Mr Williamson said.
“To meet customer expectations, Islamic fintechs worldwide need to use technology that enables flexible banking solutions to suit their customers’ lifestyles.
“Customers increasingly want digital banking that they can trust and that are convenient to use.”
Mobiquity reported that it had developed the product in six weeks.
The company, which was founded in 2011, provides end-to-end omnichannel digital services to both B2B and B2C brands.
In August last year, NAB launched a range of specialised business finance products geared towards Muslim business owners.