Islamic finance platform’s success opens doors for Dubai

Author: Gemma Varriale | Published: 12 Nov 2014

The success of Nasdaq Dubai’s launch of a platform for murabaha trading marks another step forward in Dubai’s ambition to be the centre of the global Islamic economy.

Launched this summer in partnership with Emirates Islamic Bank (EIB), the platform is focused on the daily market for murabaha, or asset-backed trading, which is valued at $5 billion to $10 billion.

The transaction involved creating a new Islamic finance platform, which uses shariah-compliant certificates, held and traded through Nasdaq Dubai’s central securities depositary, in place of commodities through a commodities exchange.

"It offers an alternative to widely-used traditional murabaha financing and seeks to address the liquidity challenges currently faced in Islamic financing by banks," said Debashis Dey, a capital markets partner with Clifford Chance in Dubai. "It’s...