Autarky Capital brings Shariah-compliant solution to market

A sukuk is a financial product that complies with Shariah principles. 

Autarky Capital Sukuk is aiming its proposition at high net worth investors who are looking for an ethical way to generate returns. 

The money invested in the sukuk will be used to provide funding for borrowers to purchase, refurbish or develop both residential and commercial properties in the UK. 

Trust certificates are issued to investors and their money is used to invest in Shariah-compliant assets. The portfolio of assets is held in trust for investors, while Autarky manages the assets and issues profits to them at the end of the sukuk’s term after fees and expenses. 

The company’s sukuk uses a Wakala-based structure which is where an agent is appointed to invest in the proceeds of the sukuk on the behalf of investors.  

Working with borrowers 

Borrowers pay Autarky Capital Sukuk in the form of Commodity Murabaha Receivables for the funding made available to them to acquire, refurbish or develop real estate. With a Commodity Murabaha, the transaction agreement is based on the purchase and sale of a good or service and the cost to the borrower is marked up. 

The borrower then makes repayments on a deferred basis which must be paid on specified dates. 

Each loan is priced individually and based on the borrower’s experience, credit risk and the liquidity of the property. 

Autarky Capital Sukuk has set out to work primarily with experienced property professionals. 

The sukuk will only be used to invest in ethical opportunities that are compliant with Shariah law, meaning this excludes sectors which are involved with gambling, pork, arms or pornography. 

The lender will also partner with organisations to donate money to charities. 

A mainstream ethical option 

The company’s founders Yasin Patel and Shoaib Bux have more than 30 years of combined experience in financial services. 

The pair launched Arbuthnot Specialist Finance in 2019, where they both worked as managing directors for three years. At the time, Bux and Patel joined Amicus Finance where they were both divisional directors for almost three years.

Prior to this, Patel worked at Mayfair Bridging as a divisional director for seven years, while Bux held a similar role at the company for one year.

They established Autarky Capital in 2021. 

Bux said: “We are proud to be announcing the launch of the Autarky Sukuk programme today, which we believe will contribute to the increase in desire for ethical investment opportunities.   

“Islamic banking assets totalled $2.8trn in 2021, and are projected to hit $4trn by 2026, according to the London Stock Exchange Group, and we believe that it is the perfect time to make sukuks a mainstream option for ethical investors in the UK.”  

Patel added: “The growing demand for ethical investment opportunities has led to a surge in the number of available products on the market. Where many of these products merely tick-boxes to be labelled as ethical options, Autarky’s sukuk is structured to be Shariah compliant, making it an overtly ethical solution available to those of Islamic faith, and otherwise.   

“We are looking forward to helping our investors improve both their ethical and social impact, and to supporting the continued growth of sukuks and wider ethical investment opportunities in the UK.”