Meghdoot Sharon in New Delhi | May 24, 2005 12:10 IST
For a devout Muslim making investments that attract the element of interest is considered ‘haram’ — something not permitted under the tenets of Islam, and this is perhaps the one major reason why not many Muslims invest in stocks or in insurance, or for that matter, even seek housing finance.
But things are changing. Ahmedabad based Parsoli Corporation Ltd, which has been involved in providing tailor-made financial products to Muslims, now offers an option where Muslims can invest in Shariah-compliant stocks, or avail of a housing finance scheme where there will be no element of interest or even help them cover themselves under an insurance cover – takaful — that is within the accepted norms of Islam.
Talha Sareshwala, chief financial officer, Parsoli, said, “It is a huge, an enormously huge, market that needs to be tapped. Whether it is insurance, or stock trading or availing housing finance, Muslims have lagged behind. We intend to change that now with our Islamic Wealth Management System.”
He added that the main aim of Parsoli is to create a new market segment of independent financial advisors. “For example, in the UK, IFAs are the link between the people and the product and IFAs are highly regulated in the UK. That is what we intend to replicate in India.”
It is generally accepted by Muslim jurists that the operation of conventional insurance involves the elements of uncertainty in the contract of insurance, gambling as the consequence of the presence of uncertainty and interest in the investment activities of conventional insurance companies, which violate rules of the Shariah.
