It’s something Finance Minister Chrystia Freeland can sink her teeth into.As part of her housing strategy released in Tuesday’s budget, the Liberal government said it is exploring alternative financing products such as so-called ‘halal’ mortgages “to understand how federal policies can better support the needs of all Canadians seeking to become homeowners.”That’s because the Islamic faith considers charging interest a form of usury and considers profitable gains made through traditional financing products — such as mortgages and credit cards — unjust and immoral..According to the budget documents, “this could include changes in the tax treatment of these products or a new regulatory sandbox for financial service providers, while ensuring adequate consumer protections are in place.”“Canada is home to a vibrant and growing market of alternative financing products, including halal mortgages, that enable Muslim Canadians, and other diverse communities, to further participate in the housing market.”.In reality, it’s mostly semantics. Although the world ‘halal’ is typically applied to food products, it literally translates as ‘compliant’ with the tenets of Sharia Law which prohibits ‘riba’ or loans that charge interest.Financial institutions in the Islamic world commonly offer mortgage and lending products that avoid conventional interest payments by replacing them with fees as substitutes for regular interest charges..For example, a so-called ‘Ijara’ loan is similar to a rent-to-own arrangement where the financier buys the property and essentially rents it out to the buyer at a fixed term. At the end of the agreement, the property title is transferred to the buyer.Although halal mortgages are already available in Canada, none of the Big Five banks presently offer them.Other Abrahamic faiths such as Judaism and Christianity also consider usury to be a sin but that’s not stopping people on social media from calling it a “woke idea” that discriminates against conventional borrowers.The account is depicted in all four gospels of the New Testament. According to the Book of John 2:16, Jesus cast the money lenders from the Temple of Jerusalem and told them: “Take these things hence; make not my Father's house a house of merchandise.”
