Joining me is Areeb Siddiqui, Founder and CEO of Kestrl. Welcome to Wall Street to Mena.
Now, Islamic banks already exist in the West. What is the problem with them that you are trying to solve?
We do have Islamic banks in the West. A lot of them are branches or subsidiaries of GCC banks or those from Southeast Asia. The problem is that the user experience of a lot of them is actually quite poor. When we started this journey, we did a nationwide survey of Muslims across the UK to understand whether they wanted to use this product and whether they were using what was on offer. 96% of people said they wanted some alternative to the existing conventional financial system and investment system, but only 3% were using what was on offer. Why? Poor user experiences, high fees, and terrible customer service — all combining to create a sense of low trust in the industry. That was the problem we wanted to solve with Kestrl.
How is Kestrl actually solving those problems?
We partnered with one of the biggest Islamic banks in the world — Maybank, which is a big bank from Malaysia. They had a branch here in London. Rather than building everything from scratch, we took their existing Sharia-compliant retail products and used our user experience, our wrapper, and our licensing to bring them to market in a genuinely new way. We have gone live with our debit card. Muslims can use that to spend in a Sharia-compliant and ethical manner, store their money in line with their beliefs, and grow it through Sharia-compliant investments and savings products.
How did the Maybank partnership come about?
Two things. My co-founder is Malaysian, so there was a natural connection. We also set up our entire tech team in Johor Bahru, Malaysia. We actually approached Maybank originally because we wanted to help them upgrade their existing application in Malaysia. We then found out they had a global ambition to expand Islamic finance into Western markets. So we thought — if we launched our own digital bank, could we take their products to market? It took some time to broker the deal, but we went live just six months ago and we are growing fast.
Western Muslims are famously hard to reach as a market. How are you actually engaging with them?
Muslims are incredibly sceptical of any product that targets them by saying you should use us because we are Islamic. That is primarily because there have been a lot of bad players in the past — people who have taken advantage, under-delivered, and in some cases there have been high-profile scams. So they have every right to be sceptical. We are doing this in a grassroots manner. In-person events, partnerships with universities and companies, roadshows across the country, a podcast called Muslim Money Talk where we invite experts from across Islamic finance, entrepreneurship, and business. A referral programme that is really helping to grow the community. And we have even given our customers the ability to invest directly into Kestrl themselves. We like to say we are built by the community, for the community.
Medina Angels recently invested. What is this funding round for?
First, to cement our position within the UK and really own this market. Then we are looking at new Western markets — we are choosing between North America or expanding further into Europe, whether that is France, Germany, or the Netherlands, which all have really large Western Muslim populations we could bring this product to.
What is next for Kestrl?
We have a whole range of features coming. Tax-efficient savings accounts in a user-friendly way for Muslims — that will go live within the next few weeks. A full wealth portfolio is on the roadmap, including self-invested pensions, stocks and shares ISAs, and individual stock trading with Sharia screening. And there are products that have never been offered in a Sharia-compliant way in the West before — credit cards and takaful, which is Islamic insurance. Through our partnerships with banks like Maybank, we can actually look to bring those to market for the first time.
Islamic fintech is projected to be a multi-billion dollar market globally. Is the West catching up?
Hopefully it will be a lot quicker than years. I think we are catching up. It was last valued at between six and seven trillion US dollars. And there was fantastic news this morning — Fassett, a Web3-focused digital bank for Muslims based in the UAE, was just valued at one billion after a recent raise. That is great news for the industry as a whole. We are really looking forward to seeing the West make leaps and bounds toward where the GCC and Southeast Asia already are.
Thank you so much for being here with us today.
Thank you.
