Islamic finance is much like traditional finance except that the services and products it creates conform to Islamic teachings, also known as sharia. To understand why – and see how the region’s banks could still grasp the industry’s reins – we must first explore the world of Islamic finance. It’s just that North America is falling further and further behind. To be fair, most countries are struggling to craft rules and regulations that standardize Islamic finance and enable it to compete with its conventional counterpart.

But the result is that banks in the region risk missing out on a fast-growing and lucrative market and the patronage of wealthy foreign investors – not to mention the millions of Muslims living in North America eager for products and services that match their beliefs. How come? We can blame a combination of regulatory hurdles, a lack of proper rules and standards and general Islamophobia. That is, everywhere except in the US and Canada. It’s a trend that has accelerated since the 2008 crisis shook confidence in conventional banking, prompting most of the world’s financial capitals from London to Dubai to join the battle to dominate the industry. Islamic finance is surging across the globe, gobbling up an ever increasing share of the more than $220 trillion in international assets outstanding.

Islamic house financing