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IslamiQ feels the dot-com crunch

In an exclusive interview by telephone, Dr Hasnita Dato's Hashim, CEO of the online Islamic efinance company confirmed that the business is being scaled down.

IslamiQ.com is the latest Middle East dot-com casualty. In an exclusive interview by telephone, Dr Hasnita Dato's Hashim, CEO of the online Islamic investment services company denied rumours that the company was liquidating assets in an effort to avoid complete bankruptcy, but confirmed that the business is being scaled down.

“It is not liquidating, but we are winding down our operations in Malaysia and Dubai,” Hashim told ITP.net. “Our online presence is very much still there but we are restructuring the whole business,” added Hashim.

The company, which functions as an infomediary, distributor of third party Shari'ah compliant financial products, and a provider of Islamic investment products and services only raised some US $10 million. Hashim confirmed “that IslamIQ has spent US $9 million.”

When asked how much business the company was able to generate, Hashim said, “the business will be restructured because of nominal revenue generated through the web site.”

While Hashem would not confirm the number of employees that would be laid off, she did confirm “a lot of people have already been laid off.”

Kuwait based The International Investor (TII) has a 30 percent equity stake in IslamIQ. The remaining 70 percent is held by the founders including Dr. Hasnita and Dutch entrepreneur Peter Faisal. Additional shareholders include private individuals.

A partner at TII told ITP, “People at TII know 90 percent that IslamIQ is in fact liquidating.”

IslamiQ has reportedly closed its offices in the Cayman Islands, London and Kuwait.

The company, launched in 2000, hoped the internet would give the mass Muslim investor market greater access to Islamic finance, an estimated $150-200 billion business growing between 20-25 percent per annum.

Whether IslamiQ will become the latest in a long line of dotcom
casualties is unclear, but its financial woes are well-known, Islamic
banking sources say.

"There's no more money (for IslamiQ) to spend," a source from TII said.

TII, which holds a 30% equity stake in IslamiQ, is looking to recoup
some of its investment in the ailing dotcom. "We've taken on a couple oftheir (IslamiQ's) staff, who will keep up the relationship with IslamiQ's clients," he said.

IslamIQ has one primary Islamic e-finance competitor, iHilal.com, which is backed by the Rasmala group. Analysts predict that iHilal.com may try and determine if there are existing synergies in IslamiIQ that could benefit iHilal.com.

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