Akhira Capital has the capacity to obtain funding for Australian and International based proposals.
Since 2009 through today, there remains fierce competition for capital. As a result, non-traditional alternatives are being sought, and Islamic Finance falls within this vein.
Islamic finance offers substantial benefits to its participants. With the Australian government sanctioning this type of finance the timing is right for prospective borrowers to proceed with finance applications for Australian based proposals. It is important to highlight that this form of finance has been available for quite some time in England, Germany, France, Japan, Singapore, Hong Kong and Malaysia, just to name a few.
Sukuk (Islamic Bonds)
Akhira Capital can coordinate the provision of funds via an instrument called a Sukuk or Shariah-compliant bond. Shariah-compliant lending is a form of finance that complies with Shariah law, this means the funding does not permit:
The paying or charging of interest;
Alcohol and gambling ventures; and
Transactions of a speculative or uncertain nature –
the underlying assets must be clearly identifiable.
Sukuk’s are typically issued by a special purpose vehicle (SPV) which could be a trust or a company.
The market for Sukuk is now maturing and there is an increasing momentum in the wake of interest from issuers and investors. Sukuk have confirmed their viability as an alternative means to mobilise medium to long-term savings and investments from a huge investor base.
Different Sukuk structures have been emerging over the years but most of the Sukuk issuance to date have been Ijara Sukuk, since they are based on the undivided pro-rata ownership of the underlying leased asset, it is freely tradable at par, premium or discount. Tradability of the Sukuk in the secondary market makes them more attractive.
Although less common than Ijara Sukuk, other types of Sukuk are also playing significant roles in emerging markets to help issuers and investors to participate in major projects, including airports, bridges, power plants etc. The Sovereign Sukuk issues, following Malaysia’s lead, are enjoying widespread and positive acclaim among Islamic investors and global institutional investors alike.
“Islamic Finance is about ethics, integrity, accountability, and social responsibility, it encourages business and entrepreneurship purely on profit and loss sharing basis and completely prohibits fixed incomes. Sharing of risk and returns by Investors and Entrepreneurs is an integral crux of Islamic finance.”
“Islamic banking is for all mankind and not a push for Islamic laws, the fact that you are seeing it in the media now is not because Muslims are pushing it, it is because it makes sense.”
“Conventional commentators describe the industry as “banking without interest” but the fundamental differentiator is the nature of money itself. In Islamic economic theory, money is merely a medium of exchange, not a commodity to be traded. It has no intrinsic value. Financial transactions must have an underlying attachment to the “real economy”. Real assets must be bought and sold as opposed to the trading of intangible pieces of paper.”
“When you or I write a check there must be sufficient funds in our account to cover that check, but when the Federal Reserve writes a check, it is creating money.”