Oman’s Sharakah Delivers First Shariah-Compliant Financing Options

Muscat, Oman – Sharakah, Oman’s leading Small and Medium-sized Enterprise (SME) development company, has launched its inaugural suite of Shariah-compliant financial solutions, marking a significant milestone in the Sultanate’s financial landscape. This initiative positions Sharakah as the first SME-focused fund entity in Oman to offer such ethical financing products, directly addressing the growing demand for Islamic financial principles within the business community.

The introduction of these new solutions, rigorously evaluated and certified by M/s Eltizam Sharia Financial Consultancy, represents a transformative shift in SME financing. It aims to foster a more inclusive and ethical financial ecosystem by bridging the gap between Islamic financial principles and the funding needs of SMEs.

Ali bin Ahmed Muqaibal, CEO of Sharakah, emphasized the importance of this launch: “This launch marks a transformative shift in SME financing in Oman. By bridging the gap between Islamic financial principles and SME funding needs, we are fostering a more inclusive and ethical financial ecosystem. Many SMEs were at risk of being left behind due to the lack of Shariah-compliant options.” He added that Sharakah conducted thorough market analysis to identify gaps and develop tailored solutions that empower SMEs to grow while adhering to Islamic financial principles.

The newly introduced Shariah-compliant offerings are designed to cater to diverse business needs, providing flexibility, ownership opportunities, and investment management, all while ensuring adherence to Islamic finance principles. Key products include:

• Ijara Muntahia Bittamleek: A lease-to-own model that enables businesses to acquire assets through a structured leasing plan, offering financial stability and a clear path to ownership.
• Wakala Bil Istithmar: A structured investment agreement where SMEs manage funds entrusted by Sharakah, generating returns while ensuring full adherence to Islamic financial principles.
• Murabaha: A cost-plus financing model that provides an ethical alternative to traditional loans, allowing SMEs to purchase assets at a pre-agreed profit margin instead of incurring interest.

These solutions are structured to accommodate both short-term and long-term funding needs with varied repayment structures, providing a much-needed alternative for SMEs that prioritize Islamic financial products due to religious beliefs or ethical considerations. Notably, Shariah-compliant funding also offers an additional safeguard for entrepreneurs by protecting businesses from interest-on-interest charges in cases where a project fails for genuine reasons.

This strategic move aligns with Sharakah’s vision to play a crucial role in Oman’s SME ecosystem and make a lasting positive impact, reinforcing its commitment to ethical, sustainable, and impactful financing.