The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has accepted Texas-based Islamic digital banking start-up Fair as a member, lending strength to the Shariah integrity of the start-up which is looking to serve the marginalized communities often overlooked by conventional banks.
AAOIFI’s approval comes as the neobank raised US$20 million in funding from private investors in February ahead of its public launch expected in the first half of this year. Through its sponsor bank, Washington’s Coastal Community Bank, Fair is currently offering basic banking services such as remittance and debit cards to its members.
As it inches closer to opening up its digital doors to the public, the digital bank is also planning to widen its range of products to include credit cards, high-yield dividend savings accounts, business dividend accounts, buy-now-pay-later interest-free microfinancing, Riba-free equity-based financing, pension programs, trust and estate planning as well as investment products which are aligned with socially responsible investing and environmental, social and corporate governance principles.
Operating in a market increasingly saturated with neobanks, Fair very early on identified its unique selling proposition: to deliver social impact particularly among the unbanked segment, immigrant communities and minorities with ethical financial services. Achieving Shariah compliance was a natural step in order for Fair to appeal to the religious-conscious community. The digital bank also channels 2.5% of its profits to the UN Refugee Agency. The direction Fair has taken is shaped by the vision of its founder, Khalid Parekh, an immigrant himself who struggled to access traditional financial services when he arrived in the US over two decades ago. Parekh is also the founder and CEO of AMSYS Group, an enterprise value company operating in technology, capital and healthcare sectors, valued at US$350 million.