More than 560 banks worldwide adhere to Islamic principles; however, the report, titled Beliefs & Business: The Shape of Islamic Finance in 2024 reveals that 39% of Muslims don’t know that Islamic banking is a possibility. Just over a quarter (28%) of Muslims say that they don’t have easy access to banks that adhere to Islamic principles, while a fourth (25%) state that they need more from their banks and a further one-fifth (18%) don’t trust their banks’ ability to be fully Shariah-compliant.

Omar Paul, SVP of Product and Engineering at Mambu says: “We are seeing a growing opportunity for financial institutions to offer Shariah-compliant financial products to meet changing needs from consumers. It’s no surprise that our new research echoes this, highlighting that 83% of respondents want the investments their bank makes using their money to align with their religious beliefs - an increase from 74% in 2021. Banks need to examine their portfolio and increase awareness around financial options available, to ensure they meet the rise in demand for Islamic banking, as well as ethical banking.”

The global research, which was first initiated in 2021 and repeated in 2024, has highlighted that although this group of consumers try to actively seek out Islamic banking products, they continue to be underserved. This presents an opportunity for financial institutions to expand their Islamic financial services in the UK given that 31% of millennial and Gen Z Muslim consumers say they use traditional/investment banking, but are considering Islamic banking.

If banks want to reach millennial and Gen Z UK Muslim consumers with Islamic finance services, they have education and access work to do first - 44% of UK respondents say the reason they don’t use Islamic banking is because they didn’t know it was a possibility - the joint highest percentage among the regions surveyed, along with Saudi Arabia. In fact, the UK is the only country where less than half of respondents (35%) say they are aware of the product range of Islamic banking.

Many banks may be under the misconception that there isn’t a demand for Islamic banking products, however, further findings revealed that faith-based and ethical values are still very important to millennial and Gen Z Muslims in the UK. 82% of them say it is important the investments the bank makes using their money does good in the world, and the same percentage say it is important these investments are ethical.