Musaffa is trying to solve a perennial problem Muslim investors have grappled with for a long time — how to grow their wealth in a halal Shariah-compliant way. 

Founded in 2020, Musaffa is a leading halal investment and research platform. Its website allows Muslims to learn, screen, and invest in halal stocks & ETFs globally.

Co-founder Dilshod Jumaniyazov set up the company after noticing a need in the community. 

Dilshod built a career in traditional banking, working for over eight years for the multinational finance firm Wells Fargo. But as a practising Muslim and investor, he kept asking himself whether the stocks he was investing in were truly halal.

“When I got to the United States over 20 years ago, I got really interested in the stock market,” Dilshod tells Islam Channel.

“I was investing in stocks. Every time I bought a stock, I wasn’t sure if it’s Shariah-compliant or not.”

At first, he thought Google would answer his queries. But the more he searched, the more frustrated he became with the mixed messages on what was halal. It was a problem his friends were facing as well.  

“If I’m feeling the pain, probably millions of Muslims out there are feeling the pain if they want to invest in line with their faith and benefit from this growing, global economy,” says Dilshod.

Musaffa’s Shariah compliance credentials

That’s when Musaffa emerged to fill that gap. They knew the demand existed based on the support from the community. For example, when securing finance, they turned to the community instead of approaching venture capitalists. 

“So, our user base, we told them, why don’t you invest in a company that’s actually Sharia-compliant and also you get to support the company that’s educating literally millions of Muslims worldwide,” says Dilshod.

They raised over $4.3m with 600 individual investors from around the world, including French World Cup star Nabil Fekir.

The website’s Halal stock screener is the marquee feature. It’s where investors can screen whether a stock is Shariah-compliant. The inquisitive can drill further down and download an extensive screening that explains why a stock is halal or haram.

“We are completely global,” adds Dilshod. “So we cover almost every single stock in the world from a Shariah perspective.”

The Shariah compliance adheres to standards set by AAOIFI (Accounting and Auditing Organization for Islamic Financial Institutions), a leading Bahrain-based organisation that develops and promotes guidelines for Islamic financial practices worldwide.

Addressing scepticism through education

One of the challenges around halal investment is the lack of education in the Muslim community, which fuels scepticism around halal investing. How do we know if a stock is truly Sharia-compliant?

“As long as the core of the operations is benefiting society in a Sharia-compliant way, you can invest,” says Dilshod, adding that according to the AAOIF methodology, at least 95% of revenue has to be Sharia-compliant. 

And the portion of a company’s income that is not Shariah-compliant goes through a “purification process.“

“So, for example, let’s say you invest in a technology company that has 96% Sharia-compliant revenue,” explains Dilshod.

“But then they have a lot of cash sitting in the bank accruing interest. So, the question comes, can I invest in this company? Sharia from AAOIFI methodology says, yes, you can. As long as the interest income is automatically donated to charity. You cannot touch it. It’s called the purification process.” 

Dilshod adds that with Musaffa, investors can use the calculator to automate that process.

The company hopes education will also stem some of the scepticism. It’s set up the Musaffa Academy, which provides users with halal stock investing tips and education. “Last time I checked, it was in the top 10 platforms in the world when it comes to Islamic finance education,” says Dilshod.

Rising demand and growth

The demand for the app is growing. Musaffa has attracted over 500,000 users from more than 200 countries, with over one million downloads.

Dilshod is pleased the website has helped many Muslims — both those who had never invested and those who were considering leaving the stock market altogether. 

“People say, ‘Thank you so much, I didn’t know I could actually invest,'” Dilshod shares.

‘I thought I was getting out of the stock market but I’m back in because now I know that there’s a Shariah-compliant way to do that.'”

Watch the full interview in a recent episode of The Ramadan Show.