More than 90 percent of Beehive’s financing Shariah-compliant, says Dubai’s first regulated P2P lender

More than 90 percent of financing distributed by Dubai’s first regulated peer-to-peer lender Beehive is Shariah-compliant, the company told Salaam Gateway.

Beehive today announced it had become the first P2P financing platform to be regulated by the Dubai Financial Services Authority (DFSA), which is the regulator for financial services based at the Dubai International Financial Centre (DIFC). The company has now moved from the Dubai Multi Commodities Centre where it was licensed, to new offices in DIFC.

Until now, there were no regulations for crowdfunding platforms across the Middle East.

Dubai has taken the lead. Last month the DFSA launched two separate consultations on its proposed frameworks, for loan-based and investment-based crowdfunding.

A clear regulatory framework for crowdfunding will improve security and transparency for retail investors, said Beehive founder and CEO Craig Moore.

"Comprehensive regulation in the Middle East is a key factor for propelling growth of the whole fintech industry and improving SME access to finance,” he added.

In December Bahrain’s central bank said it was considering introducing regulations for fintech.

In other key Islamic economies, Malaysia introduced its regulatory framework for P2P financing platforms in April 2016 and its regulatory framework for equity crowdfunding in 2015.

SHARIAH-COMPLIANT REACH

Beehive became the world’s first Shariah-compliant P2P platform to receive third-party, independent certification when it was certified by Shariyah Review Bureau in September 2015.

Since it was launched in November 2014, the company has registered almost 4,500 investors and provided more than 75 million Emirati dirhams ($20 million) to more than 150 funding requests from small and medium-sized enterprises, said Beehive.

The top three sectors that collectively made up 47 percent of all recipient companies were from Other services, which include consultancies, professional services and agencies, IT & Telecommunications, and Food services.

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