The Capital Markets Authority (CMA) has granted approval for the registration of the Ziidi Shariah Money Market Fund, a new Islamic finance product by Gulfcap Investment Bank. This milestone adds to the growing list of Shariah-compliant unit trust funds in Kenya, now numbering seven, as the country embraces diverse investment opportunities.
The Ziidi Shariah Money Market Fund is specifically tailored to meet the needs of investors who adhere to Islamic financial principles, which prohibit interest-based earnings and investments in non-compliant sectors such as alcohol, gambling, and speculative trading. This initiative aligns with the broader goal of enhancing financial inclusion and accommodating ethical investment preferences in the Kenyan market.
The fund will function as an independent entity, complete with its own incorporation documents and promoters. A key feature of the fund is its focus on registered M-PESA users who either practice the Islamic faith or prefer Shariah-compliant financial instruments. By leveraging M-PESA, the fund aims to ensure easy accessibility and participation, tapping into Kenya’s well-established mobile money ecosystem.
CMA’s approval underscores the regulator’s commitment to fostering an inclusive financial landscape that accommodates diverse investment needs. Wyckliffe Shamiah, CEO of the CMA, highlighted the significance of this development, stating, “This marks a significant milestone in the ongoing efforts to promote Islamic finance within Kenya’s capital markets. We believe Islamic finance holds immense potential, which can be unlocked through creating an enabling environment for such opportunities to thrive.”
Islamic finance has been gaining traction in Kenya over the past decade, with increased demand for Shariah-compliant products from both individual and institutional investors. The entry of Ziidi Shariah Money Market Fund into the market is expected to further accelerate this growth by providing an attractive and ethical investment alternative.
The move also comes at a time when Kenya’s capital markets are seeking greater diversification to enhance financial resilience and attract a wider pool of investors. With global interest in ethical and sustainable finance on the rise, Shariah-compliant investment products are increasingly becoming a focal point for financial institutions looking to broaden their offerings.
As Kenya continues to strengthen its position as a hub for Islamic finance in the region, the approval of the Ziidi Shariah Money Market Fund is a crucial step in expanding financial inclusion and providing a wider array of investment opportunities for both local and international investors.
