Ramadan has become a major contributor to the UK economy, generating an estimated £800 million to £1.3 billion every year, according to a report by the think tank Equi. Written by Dr Mamnun Khan, the report highlights how Ramadan is not just a time of spiritual reflection but also an important economic and social event. With around 2.6 million Muslims in the UK — about 4% of the population — the holy month is influencing shopping habits, business strategies, and charitable giving in significant ways.

The report identifies four key areas that drive the Ramadan economy: consumer spending, marketing efforts, business improvements, and charity. One of the biggest economic impacts comes from retail, with Muslim consumers spending heavily on food, clothing, gifts, and travel. Supermarkets alone see sales of £228 million to £342 million, and the total retail spend during Ramadan reaches between £428 million and £642 million. Over the past decade, spending during Ramadan has increased significantly due to a growing Muslim population, better financial stability, and changing shopping habits among younger Muslims.

Supermarkets generate approximately £228m to £342m in Ramadan sales. This represents a 2 to 3 fold increase from 10 years ago.

As a result, big supermarkets like Tesco, Morrisons, and Sainsbury’s have launched Ramadan-focused marketing campaigns. Tesco’s 2022 “Together this Ramadan” billboard campaign and Morrisons’ “Ramadan essentials” box are examples of brands catering to Muslim consumers. Sainsbury’s, after a major Ramadan campaign in 2024, saw a 21% increase in sales. Clothing brands like H&M and Asos have also recognised the importance of the season, introducing modest fashion lines for Ramadan and Eid 2025. Even IKEA has launched its first-ever Ramadan-themed home collection, offering products designed specifically for iftar and suhur.

Beyond shopping, charity is another crucial part of Ramadan’s economic impact. The report estimates that between £238 million and £359 million is given to charity during the month. Mosques play a key role in this, providing around 3.8 million free iftar meals, valued at £15 million. These meals, funded by donations, also support local businesses that supply the food. A good example is East London Mosque, which distributes 1,000-1,200 meals daily. These meals are funded entirely by donations from local businesses and individuals, demonstrating the scale of communal generosity.

Mosques across Britain serve approximately 3.8 million free iftar meals during Ramadan, worth an estimated £15m. Each day, around 125,000 iftar meals are provided at British mosques, costing an estimated £0.5m daily.

Public iftars, such as those organised by the Ramadan Tent Project’s “Open Iftar,” bring communities together and strengthen social ties. More than 300 large-scale iftars take place across the UK, turning public spaces into areas of unity and interfaith dialogue. One such example is the Grand Iftar of Bristol inside Easton Jamia Mosque. (PUT LINK)

Charitable donations to Muslim-led organisations also increase, with contributions estimated between £200 million and £300 million, significantly higher than the £145 million to £152 million recorded in 2022. Many of these donations are driven by online campaigns and humanitarian needs, including the ongoing crisis in Gaza.

The report urges the UK government and businesses to recognise Ramadan’s growing influence and take steps to integrate it into economic planning. Recommendations include supporting Muslim-owned businesses, offering workplace adjustments for fasting employees, and funding research into Ramadan’s economic effects. It suggests that the Department for Business and Trade and HM Treasury should study Ramadan-specific economic trends, while the Ministry of Housing, Communities, and Local Government should work more closely with Muslim communities beyond Ramadan to ensure year-round support.

By recognising and supporting the diverse needs and contributions of the Muslim community, policymakers, businesses and public institutions can harness the full potential of Ramadan to promote inclusivity, well-being and prosperity for all.

Businesses are also encouraged to invest in culturally relevant marketing, position Ramadan as a key period for promotions, and offer sustainable products that appeal to younger, eco-conscious Muslim consumers. Partnering with Muslim-owned businesses and promoting ethical products could further enhance the positive impact of the Ramadan economy.

Dr Khan describes Ramadan as an “under-appreciated phenomenon” that has the potential to strengthen local businesses, support supply chains, and encourage sustainable practices. He emphasises that recognising and supporting the Ramadan economy is not just beneficial for Muslims but can also create a more inclusive and prosperous society for everyone. The report concludes that by understanding the needs and contributions of the Muslim community, policymakers, businesses, and public institutions can ensure that Ramadan continues to bring economic and social prosperity to the UK.

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