Muamalat Invest’s new wholesale fund taps into P2P Islamic notes

Muamalat Invest has launched a Shariah compliant private credit wholesale fund for sophisticated investors, offering access to non-traditional fixed income instruments – specifically Islamic investment notes issued by P2P-financing operators.

The Muamalat-i Dana Sinar (MiDAS) fund will invest at least 70% of its NAV in such Islamic investment notes, issued by eligible issuers through recognized market operators on the registry of the Securities Commission Malaysia.

These instruments – with a maximum three-year tenor – can be any contract, agreement, note or other document evidencing undivided ownership or investment in specified assets, according to Shariah principles.

“MiDAS is more than just an investment fund, it is a channel for purposeful capital. It delivers stable, growth-oriented returns while meeting real financing needs across Malaysia’s entrepreneurial ecosystem,” said CEO Khadijah Sairah Ibrahim.

With its focus on financing on an electronic platform where an investor expects a financial return, specifically excluded are instruments with features of a cheque, banker’s draft or any other bill of exchange or a letter of credit; a banknote, guarantee or a Takaful policy; or a statement, passbook or other document showing any balance in a current, deposit or savings account.

Applying the Wakalah Bil Istithmar principle, Muamalat Invest is the appointed agent to undertake investment activities on behalf of investors. Aimed at high net-worth investors wanting a short- to medium-term investment horizon and having moderate risk tolerance, the entry point is set at RM100,000 (US$23,585) with subsequent RM50,000 (US$11,792) subscription multiples.

The fund targets annual returns of 8% with yearly distributions. Those who don’t opt for cash payouts will have these distributions automatically reinvested for more fund units.

This wholesale fund provides a way to mitigate the risk of investing directly in P2P platform’s Islamic notes as up to 30% of the NAV is placed in Islamic money market instruments that include negotiable instruments, repurchase agreement and commercial papers, Islamic deposits and/or Sukuk.

Launched on the 5^th August 2025, all the initial NAV is held in Islamic money market instruments while the fund size is relatively small. An active management strategy is adopted where the manager can delay deployments when of the opinion that investments in Islamic investment notes are not attractive or as a temporary defensive position during adverse market conditions.

Among risk factors to be considered are the possibility of any breaches or lapses by the P2P platform in executing Tawarruq transactions that may result in Shariah non-compliance – as due diligence is conducted only when adding the platform, rather than as an ongoing review.