US-based Saha Financial and Saha Takaful to launch by end 2023

US-based Saha Financial and Saha Takaful are looking to secure its licenses and launch by the end of the year, Ishmam Ahmed, the managing director of both entities, told ISFI.  

“It should be another three to six months before [the licensing] is finalized. Our primary investments for Saha Financial are in affordable housing and sustainability certifications from an energy perspective. Our goal is to focus on the ‘E’ and ‘S’ portions of ESG,” Ishmam commented.

The soon-to-be-licensed Saha Financial will focus on affordable housing investments and student funding, with the first housing project targeted to break ground in May 2024.

According to Ishmam, Saha Financial and Saha Takaful are regulated by Washington DC and Hawaii regulations respectively. Saha Financial is currently waiting for its lending license while the Takaful entity is working on meeting its insurance licensing requirements.

Government financing from organizations such as the US Department of Housing and Development for affordable housing projects is generally interest-bearing and going through the process of creating or sourcing Islamic alternatives within existing government programs is a laborious process.

Additionally, raising capital from abroad for such projects also has considerable tax implications, Ishmam explained as part of his reasoning for establishing Saha Financial.

Finance House-LARIBA and Guidance Residential are among the few players offering Islamic home financing in the US. In a recent development, Maine-based Anderscoggin Bank debuted its Islamic mortgage financing offering this year.

The Islamic mortgage investment space has seen more mainstream participation with the government-affiliated housing agencies Freddie Mac and Fannie Mae constituting the main investors.

Comparatively, the US Takaful market is significantly less developed. It currently has no dedicated regulations, with AIG and Zayan Takaful among the only Takaful players in the country. As such, Ishmam expects to face considerable challenges as one of the first movers in the space.

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