For many Muslim communities living in Europe, managing money is about more than just banking. It is about identity, faith, and finding a way to participate in a financial system that does not always align with their values.

New research by our PhD student Rony Azar sheds light on this challenge, surveying and interviewing over 300 Muslims across the UK, France, Germany, and the Netherlands to understand how Islamic finance fits into their everyday lives.

The findings paint a nuanced picture. Awareness of Islamic banking is high, but actual uptake remains limited, held back largely by a lack of accessible products and inconsistent regulation across European countries. For many, the desire is there; the infrastructure simply is not.

The research also uncovers a fascinating generational divide. Older, first-generation immigrants tend to view Islamic finance as a matter of principle, a way of staying true to their faith in a foreign land. Younger, second-generation Muslims take a more pragmatic approach, balancing religious values with the realities of modern European life.

Rony’s work calls on governments and financial institutions to take Islamic finance more seriously as a tool for inclusion, arguing that clearer regulation and better product access would go a long way in bridging the gap.

The full study is available at https://doi.org/10.47556/B.OUTLOOK2025.23.17.