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The Minneapolis-St. Paul metro area is home to more than 20,000 East African immigrant households, many of which are Muslim. In recent years, there has been a growing interest in the extent to which this population utilizes mainstream financial services and products. Traditional loan products that charge interest are contradictory to principles found in Islamic law. For many East African households, this presents a barrier to accessing the credit needed to purchase a car, start a business, or buy a home. Fewer than 1 in 5 East African households in the Twin Cities area own their homes, and the homeownership rate is likely lower for East African households that practice Islam. Alternative finance options—that is, lending products that do not charge interest—could enable East African Muslim families—many of which are, increasingly, upwardly mobile professionals—to expand homeownership and wealth-building opportunities.
In order to better meet the financial services needs of this population and support its access to credit, Local Initiatives Support Corporation Twin Cities (LISC Twin Cities), the Federal Reserve Bank of Minneapolis, Minnesota Housing, and Minnesota Homeownership Center partnered on this crucial study.