It was a rainy Sunday, arguably the coldest rainiest Sunday, since this year’s summery spring hit Canada. Nevertheless, my curiosity was too insisting, so I packed my baby’s diaper bag, kissed my puppy goodbye and dragged my husband for quite a drive to Toronto halal food festival.
With weather like that, the turnout will for sure suffer, I thought. So I was in disbelief when it took us 15 minutes to find a parking spot. I can already see the big crowd at the entrance. These people are serious about halal lifestyle. Once inside, my smell sense was at peak performance with all the great food showcased but my eyes were vetting the booths trying to locate some sort of Islamic Finance presence. And sure enough, there they were.
Present at the event, were fully fledged Islamic institutions, offering Islamic financial products only and Islamic windows of big investment houses. This is a good sample of institutions representing Islamic Finance in Canada. After engaging in very productive discussions with each and everyone of them, I noticed some strikingly similar practices, business focus, enthusiasm and issues plotting the landscape of Islamic Finance in Canada at the retail level:
- Demand is increasing, a lot: unanimously, they all enthusiastically talked about how very busy they have been throughout the festival and at their respective institutions. Awareness is strongly rising and demand is following suite.
- Market concentration: So far, Islamic finance clients and interested potential clients are Muslims. As per Statistics Canada, the Muslim community is rapidly growing in Canada, the majority of Canadian Muslims being in the province of Ontario. At the last census (2001), Muslims in Ontario accounted for 61% of all Muslims in Canada. Following is the province of Quebec which is home of most North African immigrants. So naturally, that’s where the institutions are concentrating their marketing efforts with a few expanding to reach all the way to the province of British Columbia!
- Product offering: The most popular product is hands-down real estate, be it residential or commercial. Currently, clients’ demand is driving the product offering; however awareness is definitely on the rise regarding Islamic Mutual Fundsand Shari’ah compliant securities. The general practice is to pick securities from different Shari’ah compliant indices, particularly US ones, such as Dow Jones Islamic Market Indices.
- Knowledge of Islamic finance: The technical knowledge of Islamic finance is, for the most part, basic. This is not surprising given the position of Islamic finance in Canada so far.
- Marketing strategy: So, how do those institutions get their clients? They go to the source. Just like what they were doing at the Halal Food Festival, they get their clients at events targeting Muslims, Islamic centres, mosques ect. Some organize their own conferences and seminars about Islamic financial products keeping the events advertising amongst Muslim communities and mostly relying on the word of mouth.
So you notice right away what areas are requiring some work in order to take Islamic finance in Canada to the next level. Tackling some issues first, will naturally improve and directly help address others, like:
- Knowledge will help address product offering and diversification.
- Use of mass marketing tools will help unlock the potential of Islamic finance market in Canada.
- And all will only feed into creating a buzz and therefore building momentum.
Bottom Line: It’s looking good! Islamic finance is present in Canada is more that you would think. It is happening, quietly. Islamic finance in Canada is in the calm before the storm.
About the Author
Loubna Benslimane – CDIF :Founder of Islamic Finance ResearChat (www.islamic-finance.ca) the 1st Canadian media providing information on Islamic Finance.
Loubna’s interest in Islamic finance started about a decade ago and since then she has been closely watching its evolvement and extensively analysing its stupendous global growth and reach. To give her expertise more structure and make sure she covered all areas of Islamic finance, she completed CIMA (Chartered Institute of Management Accountants, UK) Diploma in Islamic finance. Loubna’s mission is to provide easy to understand information about Islamic finance particularly to fellow Canadians and then to the rest of the globe.
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