Islamic banking and finance in Canada

The demand for Islamic banking and finance has grown in Canada due to the growing Muslim population in the country who want to avoid riba and other financial practices in violation of sharia. These sharia-compliant financial products are not offered by main financial institutions and, thus, small financial companies are major players. However, major companies like WealthSimple are starting to embrace the idea.

History
A Toronto-based financial company UM Financial started giving Sharia-compliant loans to Muslims in 2005 in partnership with Central 1 Credit Union of Vancouver. The company planned to offer no-interest MasterCard as well. UM financial was ordered to go into receivership by the Ontario Superior Court on October 7, 2011. Omar Kalair and Yusuf Panchbaya of UM Financial were charged by RCMP for $4.3-million mortgage fraud, but both men were acquitted of all counts contained in the indictment in Ontario Superior Court June 7, 2019.

Islamic Mortgage in the main stream
The 2024 federal budget announced on April 16 included plans to bring halal mortgages into financial regulatory system.

Roboadvisors/ Investments Managers
Some institutions have started offering accounts including Registered Education Savings Plan (RESP), Registered Retirement Savings Plan (RRSP), Tax-Free Savings Account (TFSA) etc.