(June 16): Wahed Invest LLC is in the process of completing a funding round of US$50 million as it looks to disrupt the Islamic finance space.
The funding was led by Wa’ed Ventures, the venture capital arm of Saudi Aramco Entrepreneurship Center and gives the Islamic fintech a post-money valuation of around US$300 million, according to a statement by the firm. Other backers included family offices and soccer star Paul Pogba.
The start-up is planning to use the funds to expand into the Middle East and North Africa, including Saudi Arabia. And it will start a digital banking service on its UK platform aimed at underserved communities.
The aim is “to make the Wahed platform a one-stop-shop for ethical banking and investing tools,” said Chief Executive Officer Junaid Wahedna.
Wahed Invest offers saving and investment options that let Muslim customers invest in line with their faith, for instance by avoiding companies earning profits from lending, gambling, alcohol and tobacco.
The New York-headquartered firm was founded in 2015 and has about 300,000 customers in countries like the US, UK and Malaysia. It now has 11 offices around the world, and currently holds nine regulatory licenses including in India and South Africa.
Islamic banking is booming worldwide, with the industry growing 11% in 2020 to encompass US$2.7 trillion of assets, according to an August 2021 report by the Islamic Financial Services Board. Wahed said there was high demand for fintech products that are both ethical and easily accessible for individual investors.
HSBC Holdings Plc was the lead financial advisor for Wahed in the series B funding round.