Berjaya Mutual Shariah Private Credit Fund I

The latest fund launched by Berjaya Mutual is an initiative to develop Shariah compliant financing structures that address the growing demand in Malaysia for non-bank funding solutions, CEO Daliya Daud told IFN Investor.

With Malaysia's SME financing gap exceeding RM100 billion (US$25.43 billion) and traditional bank financing still accounting for over 90% of SME credit, the “private credit segment remains relatively underrepresented within the Islamic finance landscape,” said Daliya.

The launch of the Berjaya Mutual Shariah Private Credit Fund I also aims to cater for market demand among institutional and high-net-worth investors for Shariah compliant income strategies with lower sensitivity to equity market volatility.

“While Sukuk remains a core asset class and cornerstone of Islamic portfolios, structural constraints around issuance volumes, market cycles and tenors may limit its ability to fully meet evolving income and diversification needs. In this context, Shariah compliant private credit is emerging as a natural extension of the Islamic capital market.”

From a Shariah structuring perspective, domestic private credit provides greater flexibility and alignment compared to conventional offshore money market instruments. In addition, private credit offers a relatively higher yield, Daliya commented.

Being a three-year wholesale close-ended fund, which aims to provide sophisticated investors with regular income, redemptions are not allowed till the fund matures. Quarterly distributions are subject to the availability of realized income received from investment, targeting an average absolute total return of 8% per annum.

Entry and subsequent investments are set at RM10,000 (US$2,543) multiples – to be completed within the 45-day offer period from the 19^th January 2026 launch. No units will be available for sale after this offer period, which may be shortened by the fund manager.

With holdings primarily in Islamic investment notes, at least 70% of the fund’s NAV is allocated to fixed income securities. The rest is held in liquid Islamic money market instruments or ringgit cash equivalents plus other Shariah compliant collective investment schemes.

The fund will mainly target Islamic investment notes issued by suppliers or contractors whose ultimate paymaster is the Malaysian government, including government-linked companies and government agencies, with NAV exposure limits of 15% for each issuer and 30% for groups.

As there is currently no publicly available secondary market for Islamic investment notes, the fund manager may engage the platform in which the notes are purchased from.

“Over time, we expect Shariah compliant private credit to evolve into a complementary allocation alongside Sukuk and equities, offering diversification and improved risk-adjusted returns,” stated Daliya.

*Disclaimer: The opinions and viewpoints expressed in this Fund Profile do not constitute recommendations for any fund highlighted. The information presented is not investment advice and should not be treated as such.