The Minnesota Daily has reported that the city of Minneapolis is providing Islamic financing and Shariah-compliant loans and lending solutions to Minneapolis businesses. According to the paper, the city of Minneapolis has partnered with the African Development Center to loan funds to Muslim business owners in the local Minneapolis community in a manner that is Shariah-compliant and avoids variable rate interest financing.

Provisions in the loan program, termed the “Alternative Finance Program,” require Minneapolis Muslim-owned businesses to pay a fixed rate of return, similar to an altered version of the “Two-Percent” loans offered by the City’s Department of Community Planning and Economic Development. The Minnesota Daily reports that 38 such loans have been provided so far. The loans have gone to restaurants, retailers, computer, clothing, and bookstores.

Minneapolis Community Planning and Economic Development Business Finance Director Bob Lind states that he believes Minneapolis is the first U.S. city to adopt Shariah-friendly loan programs. He sees the city’s version as becoming a model for others in the future.

For the original Minnesota Daily story, please click here: http://www.mndaily.com/2010/03/24/loan-caters-minneapolis-muslim-business-owners

For information on Islamic financing or Shariah-compliant transactional products, please contact Ice Miller’s Islamic Finance, Business, and Litigation attorneys at info@islamic-finance-blog.com.