The paper reveals that flexible regulation increases opportunities for shariah compliant products and services and also discuses the challanges which will be faced.

Callum McCarthy, chairman of the FSA said, "Islamic finance is a fast-growing force in the world economy and the FSA's open and principle-based approach to regulation offers the right environment for it to flourish in the UK... There is huge potential for an expansion of Islamic offerings in the UK's financial markets, which will in turn boost London's position as an international financial centre... We believe in a 'no obstacles, no special favours' approach when authorising new financial institutions and welcome the development of this market as it provides certain UK consumers with financial products that are in line with their beliefs.”