NAB has backed the expansion of a Melbourne-based construction company through its recently expanded Islamic finance for business customers.
NAB’s specialised Islamic business financing now allows customers to buy commercial property and land over $5 million. Launched in August 2021, the finance option was initially available for commercial property development and construction purposes only.
Bodon Homes (pictured above) is one of the first businesses in Australia to finance the acquisition of commercial property and land through NAB’s enhanced product offering, which will enable it to construct 30 homes in Mordialloc using a finance facility that meets both Islamic legal requirements and Australian law.
Imran Lum, NAB head of Islamic finance, said NAB is the only Australian bank at present that is offering this type of financing.
“We were proud to be the first Australian bank to offer specialised business Islamic financing, and we’re thrilled to be expanding this option to enable business owners to finance their growth by purchasing commercial property and land too,” Lum said.
The NAB product is designed to meet both Australian and Islamic legal requirements and is structured as a lease-to-own, where rent and service fee charges are paid instead of interest.
The offering is also endorsed by global Shariah advisory firm Amanie Advisors to provide comfort to customers around Shariah compliance.
“We’re looking forward to continuing to work with the Muslim business community here in Australia – understanding their needs to help more businesses grow where they might have otherwise used friends and family to raise capital,” Lum said.
“And it’s not just Muslim businesses – in many cases, we have financed non-Muslim businesses that have requested this type of financing because they have a Muslim partner or investor who have a preference for Islamic financing, so this allows us to financially include more people.”
Mahmoud El Bodon, Bodon Homes director, said NAB’s specialised financing for Muslim businesses has made the process of buying commercial land simple.
“The specialised banking team at NAB understood our unique needs and were able to work with us to grow our business – aligned to our Islamic values and beliefs,” El Bodon said.
“Access to Islamic finance at competitive rates is a huge game-changer for Bodon Homes. Previously, we were limited to the capital we had within our network, but now we can leverage NAB’s Islamic financing. This will allow us to seriously consider larger projects as well as the build-to-rent market – both of which are now commercially viable for us.”
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