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Could the end of the Sharia-compliant loan crisis for Muslim students be in sight?


We all remember the outrage that engulfed the British student population a few years ago when tuition fees were raised, in most institutions, to a staggering £9,000 per year.

This mobilised mass student street and campus protests in the face of a lifetime of debt, and was recently reinforced by the NUS's declaration in support of free education. Under the new system, the average student will now leave university owing £44,000, which for some graduates won’t be paid back until they reach their 50s. Contrary to the Government’s initial optimistic estimates, for many more students, up to 85 per cent to be exact, their debt will never be fully repaid.

Financially it appears to be a rather daunting own goal on behalf of the Government – tuition costs have trebled and yet costs to the taxpayer have risen. Liam Byrne, the shadow minister for universities, science and skills, rightly described the new system as having “lost all fiscal credibility” and "losing public confidence".

Aside from the hike in tuition fees, the new system of student loans includes an interest charge of up to three per cent above inflation. In itself the additional interest rates are problematic for all students - but significantly more so for many Muslim students – something which was unfortunately (and unintentionally) overlooked in the initial change in the student loan system.

For many Muslim students, for whom their faith plays an important role in their everyday lives, interest charges are in fact strictly prohibited under Islam. While the community is diverse and religious opinions often differ, only a small minority of Muslim students see this as a non-issue and see no need for an alternative. So now the majority of Muslim students face an ethical predicament - meaning some go to university and take a student loan on with an awkward state of unease, while others opt out of university education completely because of this barrier.

This is something we at FOSIS have highlighted in the past and while we do not have exact data on how many Muslim students are being deterred from university, I can confidently state that many thousands are being affected. My colleagues at FOSIS and I have relentlessly travelled the length and breadth of the UK and time after time we meet Muslim college students unwilling to go to university, and enrolled students who are desperately awaiting alternative financing options to end their moral impasse. Moreover I have received a ton of communication from concerned parents, wondering what future their children may have and questioning why their children’s rights of access to education have been stifled.

Of course access to education is a basic human right, but importantly, equal access to higher education is a necessary ladder for minority communities to climb out of the poverty trap, which is no different for the British Muslim community. Many concerned students and indeed parents have argued that this is the biggest crisis facing the community – compounded by the adversity already facing Muslims in the UK.

For the past three years, FOSIS, which represents over 115,000 Muslim students in higher education, alongside our partners, the NUS and 1 Ethical, have been proactively campaigning to solve the dilemma facing Muslim students and their prospects in higher education. We’ve been met with many hurdles and dead ends, but we are now enthusiastic that there is some light at the end of the tunnel!

Earlier this month the Government started its open consultation with the public on the aforementioned crisis facing Muslim students – which is good news and the stepping stone towards a meaningful solution.

What is now needed is a concerted effort to respond to the consultation process highlighting the real and genuine issues facing young Muslims and welcoming a potential Islamic-compliant student loan. The need for this is clear and I’m confident that this will provide the evidence required to move the process forward. However, any alternative student loan model offered by the Government must be accepted by the mainstream Muslim community with the support of British Islamic scholars by adhering to internationally accepted standards.

This is an imperative step to ensuring equal access to education and in the long-term, creating a more equitable society. Many bright, intelligent and ambitious children are counting on this. The government’s consultation process is open until 12 June – so don’t waste time and send in your responses.