Lack of scholars limits UK Islamic finance

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MANAMA, Nov 29 (Reuters): A lack of Islamic scholars and global standards for Islamic finance could hamper British efforts to become a hub for the booming industry, Britain's top financial watchdog said yesterday.
The global Islamic finance industry could be worth as much as $800 billion and is growing at about 15 per cent per year. The United Kingdom is keen to attract more Islamic business and has passed legislation catering to the industry.
Still, a shortage of scholars, who determine whether financial products and practices comply with Islamic law-known as sharia-is one of several challenges to the growth of Islamic finance in Britain, the Financial Services Authority (FSA) said.
"The shortage of appropriately qualified scholars ... means it is common for individual scholars to hold positions on the sharia supervisory boards of a number of Islamic firms," the FSA said in a report on the industry in the UK.
"This raises concerns over the ability of sharia supervisory boards to provide enough rigorous challenge and oversight," the FSA said.
Islamic law bans the receipt of interest, and investments in industries such as alcohol, gambling and pornography. Islamic finance is based on the principle of sharing risk and reward among all participants of a venture.