Wahed, a U.S.-based Islamic fintech that offers a compliant investment management platform, has acquired Niyah, a British company that runs a banking app designed for Muslim communities. Terms of the deal were not disclosed.

Why should we care?
Among the central tenets of Islamic finance are the prohibition of interest (“riba”) when lending or accepting money. Investments in companies involved in gambling, alcoholic beverages or pork products are typically not allowed. Wahed’s portfolios do not include investments in companies in sectors such as gambling, firearms, and alcohol. By acquiring Niyah, Wahed moves along its path to become a one-stop shop for Islamic financial services, and can more easily expand to the U.K. and other markets. Islamic banking is a new area for fintech, with companies working to build tech-enabled solutions that also have Shariah-compliant processes. Niyah offers its clients interest-free financial products including digital bank accounts, debit cards, and investments. In June, Saudi Aramco Entrepreneurship Ventures invested $25M in Wahed. Shariah-compliant financial services is a growing industry. According to recent research from ICD-Refinitiv cited by The World Bank, in 2018, 1,447 Shariah-compliant financial institutions were operating businesses in 72 countries with Islamic finance assets, which are expected to increase from $2.5T in 2018 to $3.5T in 2024.