Last updated 14 November 2026 · Reviewed by Riyadh Financial Services Compliance
At a glance
- A Shariah-compliant label tells you what a product aims to do. The structure and documents show how it does it.
- Ask where the financier's return comes from, who is on the title, and what the current Shariah certificate covers.
- Check separately that the provider is licensed to arrange or provide credit in Australia: that's a legal question, not a Shariah one.
- For how a lease that ends in ownership works, see how Islamic home finance works.
What makes finance halal?
In general terms, scholars look for finance that:
- avoids riba, which is any increase charged for lending money for money;
- earns its return from a real asset, a genuine sale or a partnership, such as rent on a property;
- avoids gharar (excessive uncertainty in the contract) and maysir (gambling or speculation);
- isn't used for anything haram (not permitted).
Scholars have developed several contracts that meet these principles, such as Ijarah (a lease), Murabaha (a sale at cost plus a disclosed mark-up) and Diminishing Musharakah (a partnership in which one partner gradually buys out the other's share). Our guide Ijarah vs Murabaha compares them.
Does a Shariah-compliant label mean a product is halal?
Not on its own. Shariah compliance depends on the contract, the documents and how the product works day to day. Scholars can also take different views on the same structure, which is why it helps to understand it yourself.
In Australia, Islamic home finance is regulated as credit under the National Consumer Credit Protection Act, whatever the Shariah structure. The same consumer protections apply, including hardship help and free external complaints through AFCA. However, no government body certifies Shariah compliance.
What questions can you ask any Islamic finance provider?
These general questions work for any provider. A good provider should be happy to answer them in plain English.
| Ask about | Questions to ask | Why it matters |
|---|---|---|
| The structure | Which contract is used? Is it a lease, a sale or a partnership? | Each structure works differently, and you should know which one you're signing. |
| The return | Where does the financier's return come from? What is the rate called, and how is it set? | The return should come from a real asset, sale or partnership, not from money lent. |
| Ownership | Who is on the title? What does the financier hold, and when does full ownership pass to you? | It shows how the asset sits behind the finance. |
| The Shariah certificate | Can I see the current certificate? Which products does it cover? When was it last reviewed, and is it reviewed again when a product changes? | A certificate applies to particular products and structures, so check it matches the product you're offered. |
| The documents | Which documents will I sign? How do the Shariah documents fit with the credit contract and mortgage? | You can read how the structure works in practice before you commit. |
| Problems and changes | What happens if I pay early, sell, or have trouble making payments? | It helps you understand the full life of the finance. |
| Insurance | What insurance is required? | Some providers require conventional building insurance, so ask before you apply. |
How do you check a provider is licensed in Australia?
Shariah review and Australian law are separate checks. Anyone who provides credit, or arranges it for you, must hold an Australian Credit Licence or be an authorised credit representative of a licensee.
- Search the provider's name on ASIC's professional registers to check its licence or credit representative details.
- Check the licence details in the provider's Credit Guide and website footer.
- Confirm the provider or its licensee is a member of AFCA, the free external complaints service.
Be wary of anyone who pressures you to sign straight away or asks you to pay money into a personal account. Moneysmart explains how to check and report scams, and our scams and security page has more tips.
What are the pros and cons of checking for yourself?
Possible pros
- You understand what you're signing and why it's structured that way.
- You can take the structure and the certificate to your own scholar for a view.
Possible cons
- It takes time, and some documents use technical terms you may need explained.
- Approval isn't certain: every application is assessed against credit criteria.
How do you check an Islamic finance provider, step by step?
- Talk to a broker about your plans. If you don't have a broker, contact us and we can refer you to an accredited broker.
- Ask the provider to explain the structure and where its return comes from.
- Ask for the current Shariah certificate and what it covers.
- Check the licence details on ASIC's registers.
- Read your credit contract, mortgage and Shariah documents before you sign, and seek your own scholar's view if you'd like one.
How can Riyadh Financial Services help?
Riyadh Financial Services arranges Shariah-compliant property finance through accredited mortgage brokers. Accredited brokers must act in your best interests under Australian credit law (the best interests duty), and they work across Australia, in person or online.
- Our Ijaar home finance uses Ijarah Muntahia Bittamleek, a lease that ends in ownership, so the financier earns rental on a real asset.
- You're the registered owner on the title from settlement. The financier holds a registered mortgage and a beneficial interest (an ownership share), which passes to you when all payments are made.
- Our licence details are in the footer of every page of this website.
Our product structures are reviewed by our independent Shariah adviser. Our Shariah certificate is reviewed regularly, and again if a product changes. Ask us for a copy and what it covers. We explain how our structures work, but we don't give religious rulings, and you're always welcome to seek your own scholar's view.
Keep reading:Islamic finance contracts explained · How Islamic home finance works · Ijaar home finance · Islamic bank vs Islamic finance provider