Mana is an educational platform. We're not regulated by the FCA and nothing here is a personal recommendation. Everything you see (ETF illustrations, goal projections, quiz results, AI responses) is general information to help you learn. Before investing, please do your own research and consider speaking to a regulated financial adviser.
ETFs · Index funds · Workplace funds · Stocks · Mana Credit · Compare halal products ↗ · Terms · PrivacyETFs are screened for you. But if you want to invest in individual companies, here's how to run a proper Shariah screen, handle borderline cases, and purify tainted income.
A halal ETF like ISWD or HIES has a Shariah supervisory board that screens every holding quarterly. You buy the fund and inherit their work.
Individual stocks are different. No one is doing the screening for you. You need to run the checks yourself, or use tools that do it for you. And unlike an ETF where diversification absorbs one bad holding, a single stock that fails a screen represents a meaningful portion of your portfolio.
Zoya (zoya.finance) rates companies as Halal, Questionable, or Not Halal. It uses the AAOIFI methodology by default and covers most major listed companies. Free tier available; premium tier unlocks full ratio breakdowns. Best for quick checks on well-known companies.
Musaffa (musaffa.com) goes deeper. It shows you the exact financial ratios used in each screen, compares the company against both AAOIFI and MSCI methodologies, and shows you historical compliance changes. Better for rigorous due diligence on smaller or borderline companies.
The primary business must be permissible. A company that derives more than 5% of revenue from prohibited activities (alcohol, tobacco, conventional interest-based banking, gambling, adult entertainment, weapons) fails.
Grey areas: a supermarket that sells alcohol but whose primary business is groceries. Scholars generally agree the sector screen is about primary revenue, not incidental revenue. Check the Zoya or Musaffa business description carefully.
Total interest-bearing debt divided by total assets (or market cap, depending on methodology). Standard threshold: below 33%.
Companies with high leverage (banks, real estate investment trusts, utilities) often fail this screen. Apple passes; a commercial bank doesn't.
Non-operating interest income divided by total revenue. Standard threshold: below 5%.
Almost every company earns some interest from its cash holdings. The screen isn't zero-tolerance. It's about materiality. A tech company earning 0.3% of revenue from interest on its cash pile passes. A company running a captive financing arm might not.
Total receivables divided by total assets. Standard threshold: below 49% (MSCI) or below 70% of market cap (AAOIFI). A company owed very large sums by customers is effectively acting as a credit provider.
Cash plus liquid securities divided by total assets (or market cap). Threshold is typically below 33%. Excessive cash holdings often earn interest, which taints the balance sheet.
AAOIFI (Accounting and Auditing Organisation for Islamic Financial Institutions) uses market capitalisation as the denominator for financial ratios. MSCI uses total assets.
For high-growth companies with elevated market caps (many tech stocks), AAOIFI methodology tends to produce more permissive results. For asset-heavy industrials, AAOIFI can be stricter.
There's no globally agreed standard. Most UK-listed halal ETFs use MSCI methodology. For individual stocks, be consistent about which methodology you use and understand the choice you're making.
Some companies sit right on the boundary, passing in one methodology but failing in another, or rated "Questionable" by Zoya. Options:
If a company you own passes the screen but earns some incidental interest income (say, 2% of revenue), you purify by donating 2% of any dividends or realised gains from that holding to charity.
Most halal ETF providers publish annual purification ratios (usually below 1%). For individual stocks, you'd calculate it yourself from the company's annual report: impermissible income divided by total revenue, multiplied by your gain or dividend.
Purification is not a loophole. It's a recognition that perfect Shariah compliance is difficult in a conventional economy, and that intentional, good-faith investing with purification is better than avoiding the market entirely.
Done reading?
Mark it as read so you can track your progress.
Do this now
Reading is only the first step. Here’s the action.
Screen your first company on Musaffa or Zoya →Ask Mana about this article →
Something didn’t click? Just ask.