Always wanted to invest in line with Islamic principles but felt held back by high entry costs? We’ve got news. Good news.
Abu Dhabi Islamic Bank is testing fractional sukuk tech, which basically let’s you invest in smaller portions and enter the market with much less $$$. It essentially splits standard sukuk into smaller parts.
There’s growing interest – in the UAE and the Gulf region – and now the ADIB project has received a preliminary go-ahead from the Regulatory Lab, which is overseen by the UAE’s Securities and Commodities Authority.
The bank is moving forward due to “strong client demand,” sources close to the matter told MONIIFY. “But it’s still early, so we can’t share more details yet.”
Why this matters
- Traditionally, entering the sukuk market has required a minimum investment of $200,000.
- Fractional sukuk like ADIB’s allow small investors to participate with as little as $1,000.
- This offers access to fixed income investment benefits at a much lower price point.
Instead of needing substantial capital to buy into corporate sukuks, individual investors can pool smaller amounts and own fractional shares of high-value sukuk certificates.
What’s in it for investors?
Once ADIB fully launches its product, customers will have the freedom to create a customized sukuk portfolio based on their risk tolerance, sector preferences and desired maturity periods. They’ll be able to choose sukuks with specific credit ratings, returns and other features that align with your financial goals.
Interestingly, ADIB isn’t the first to introduce this strategy. In April, Emirates Islamic Bank too rolled out a fractional sukuk offering, allowing investors to access international sukuk markets with a minimum investment of just $25,000.
