Latest from GIFC

Monday, 6 July 2015

Islamic finance & management events in Kuala Lumpur Malaysia



Date: 17-18 March 2015
Event: KL Conference on Islamic Finance
Event site: www.islamic-finance-conference.net
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Date: 21-22 April 2015
Event: KL Conference on Islamic Wealth Management
Event site: www.islamic-wealth-management.net
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Date: 9-10 June 2015
Event: KL Conference on Shariah & Legal Aspects of Islamic Finance 2015
Event site: www.shariah-legal-islamic-finance.blogspot.com
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To register or reserve a seat online, please go to:

Organizer: Alfalah Consulting
www.alfalahconsulting.com

Islamic banks’ finances surge 107 per cent in Oman

MUSCAT: Oman’s Islamic banks and window operations have shown a robust growth of 107 per cent in financing at OMR1,265.8 million for the first four months of 2015, from merely OMR611.1 million in the same period last year.


Such robust growth in Islamic finance shows that Sharia-compliant banks are able to establish themselves in the market and able to overcome their teething problems.

Further, two Islamic banks and window operations of conventional banks have launched innovative products to attract Omani customers, besides opening several branches in different parts of the country.

Total customer deposits held by Islamic institutions also shot up by 194.5 per cent to OMR847.3 million by the end of April 2015, from OMR287.7 million for the same period last year, according to the latest monthly bulletin released by the Central Bank of Oman.

There has been considerable increases in the number of branches and assets held by these entities. Islamic banks are opening up new segments and players and, thus, adding to the competitive environment, not only in terms of efficiencies and innovations, but by also providing consumers the benefit of choosing between both conventional and Islamic banking products.

In Oman, two Islamic banks – Bank Nizwa and Alizz Islamic Bank – along with the window operations of six conventional banks, have scores of branches across the country.

The total assets of Islamic banks and windows stood at OMR1,371 million at the end of December 2014, an increase of 68.2 per cent over the previous year.

Islamic banking entities provided financing of OMR1,049.5 million as of the end of 2014, compared to OMR434.3 million one year earlier. Together, Islamic banks and windows brought down their combined net losses to OMROMR4.4 million last year, from a net loss of OMR13.86 million in the previous year.

(Times Of Oman / 05 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

SUKUK PIPELINE - Issue plans around the world

SARAWAK ENERGY - Malaysia's Sarawak Energy plans to issue 1 billion ringgit ($264 million) of sukuk; books were scheduled to open in late June, but were postponed after global financial markets turned volatile. The company will offer tenors of 10 and 15 years and for the first time, 20 years.

BAHRAIN - The Bahrain government announced a July 2-7 retail offer of 200 million dinars ($530 million) of 10-year sukuk ijara.
APICORP - Saudi Arabia-based Arab Petroleum Investments Corp mandated four banks for a debut international sukuk issue this year, off a $3 billion sukuk programme, sources said in late June.
ABU DHABI ISLAMIC BANK - Shareholders of Abu Dhabi Islamic Bank approved in late June authorisation for the bank to raise its Tier 1 capital to $3 billion through sukuk issuance.
TENAGA NASIONAL - Malaysia's Tenaga Nasional is seeking to raise as much as 10 billion ringgit in a sukuk issue to develop a power plant project that it is planning to take over from debt-laden state fund 1MDB, sources familiar with the matter said in late June.
TURKEY - The Republic of Turkey is seeking to raise $1.5 billion from issuance of sukuk and yen-denominated bonds this year, a Treasury official said in late June: around $400 million equivalent from the yen-denominated transaction and the rest from sukuk.
Also, the Turkish Treasury said in late May it would issue local currency sukuk in August with volume of 1.5 billion lira ($563 million).
IFC - The International Finance Corp, the World Bank's lender to the private sector, has started work on a return to the sukuk market, with plans to issue sharia-compliant debt after the Gulf summer, a spokeswoman said.
BRUNEI - Brunei's central bank is preparing to issue long-term sukuk for the first time in the "very near future" while widening the eligible list of buyers of its issuance programme, it said in mid-June.
TOYOTA - The Malaysia unit of Toyota Motor Corp plans to set up a 2.5 billion ringgit programme to raise funds via both conventional and Islamic bonds, a regulatory filing showed in mid-June.
SAPURAKENCANA - SapuraKencana Petroleum, a Malaysian oil and gas services firm, said in mid-June that it planned to raise up to 7 billion ringgit with a multi-currency sukuk programme.
SINDH - Pakistan's Sindh province plans to raise as much as $200 million through a debut issue of sukuk to help fund development and infrastructure projects, the province's minister of finance said in mid-June.
OTHAIM MALLS - Saudi Arabia's Al Othaim Real Estate and Investment Co, owner of five shopping malls in the kingdom, has revived plans to issue a debut local currency Islamic bond, probably after the summer, sources aware of the matter told Reuters in early June.
DRAKE & SCULL - Dubai's Drake & Scull International set initial price guidance for its senior perpetual U.S. dollar sukuk issue at around 9 percent on June 10, but the issue has not been launched since then, apparently because of market instability and the pull-back of some investors due to Ramadan.
ISLAMIC DEVELOPMENT BANK - The Islamic Development Bank increased the ceiling of its Islamic bond programme to $25 billion from $10 billion, as it aims to expand its financing across member countries, the Jeddah-based lender said in early June.
CAGAMAS - Malaysian mortgage lender Cagamas still hopes to issue sukuk this year off a $2.5 billion multi-currency programme set up last November, but foreign exchange volatility is hampering any issue in U.S. dollars, the most likely option, its chief executive told Reuters in early June.
BARWA BANK - Shareholders of Qatar's Barwa Bank approved plans for a $2 billion senior unsecured sukuk programme that could be issued in various currencies, the lender said in early June.
BAHRI - Saudi Arabia's Capital Market Authority granted approval to National Shipping Company of Saudi Arabia (Bahri) to issue sukuk, the regulator said on June 1. Bahri plans to complete a debut Islamic bond offer worth up to 3.9 billion riyals ($1.04 billion) this quarter, the company's vice chief executive officer for finance Mohammad Alotaibi said earlier.
BINLADIN - Saudi Binladin Group began marketing a 364-day sukuk issue to local investors in the kingdom which could raise up to 1 billion riyals, sources aware of the matter said at the end of May.
ADIRA DINAMIKA - Indonesian leasing company Adira Dinamika Multi Finance is expected to launch a dual-tranche bond at end-May, bankers said. It aims to sell bonds worth 2.5 trillion rupiah ($190 million), split into a 2 trillion rupiah conventional portion and a 500 billion rupiah sukuk portion.
OMAN - Oman plans to sell its first sovereign Islamic bond, an issue of 200 million rials ($520 million) of sukuk, through a private placement and will launch subscriptions soon, an Omani official was quoted as saying in mid-May by the Times of Oman.
AEON CREDIT - Malaysia's Aeon Credit Service said in mid-May it planned to raise 1 billion ringgit via sukuk murabaha for working capital, repayment of debt and financing for customers.
EGYPT - Egyptian Finance Minister Hany Kadry Dimian said at the end of April that he hoped to issue ijara-structured sukuk, the country's first sovereign sukuk issue, at the beginning of the 2015/2016 fiscal year starting in July.
KUVEYT TURK - Kuveyt Turk, Kuwait Finance House's Turkish unit, said in late April it had applied to the Capital Markets Board for permission to issue up to 1 billion lira of sukuk.
IVORY COAST - Ivory Coast will sell its debut sukuk in the next two to three months, and is assessing whether to make sukuk issues a regular part of fund raising, its minister for economy and finance said in late April.
CIMB - CIMB Group Holdings, Malaysia's second largest bank by assets, plans to establish a new 6 billion ringgit conventional and Islamic bond programme, a regulatory filing by RAM Ratings said in late April. A CIMB official confirmed the details.
TELEKOM MALAYSIA - Telekom Malaysia set up in late April a $750 million, multi-currency sukuk programme that may see the state-owned company return to global markets after a long absence.
KUALA LUMPUR KEPONG - Malaysian plantation company Kuala Lumpur Kepong will raise up to 1.6 billion ringgit from Islamic bonds, rating agency RAM Ratings said in mid-April.
BNI SYARIAH - PT Bank BNI Syariah, the Islamic subsidiary of state lender PT Bank Negara Indonesia, plans to issue sukuk mudaraba with a three-year tenor worth up to 750 billion rupiah in an offer on May 18 and 19, the Jakarta Post quoted CEO Dinno Indiano as saying in mid-April.
JORDAN - Jordan chose the Islamic Corporation for the Development of the Private Sector to support its debut sovereign issue of sukuk, the ICD said in mid-April; the dinar-denominated issue is expected this year and would be used to absorb excess liquidity held by Jordan's Islamic banks, which is estimated to total 1.4 billion dinars ($2 billion).
AXIS REIT - Malaysia's Axis REIT said in early April that it had expanded its sukuk programme to 3.0 billion ringgit from 300 million ringgit, and extended the length to perpetual from 15 years.
TALIWORKS - Malaysia's Taliworks Corp announced in early April that the Securities Commission had authorised its proposed issuance of 210 million ringgit worth of sukuk murabaha, Bernama news agency reported.
KAZAKHSTAN - Kazakhstan's Finance Ministry is expected soon to propose a draft law allowing its first sovereign sukuk issue, which will probably take place early next year, Yerlan Baidaulet, an adviser to the Investments and Development Ministry, told Reuters in early April.
SENEGAL - Senegalese President Macky Sall said in early April that he had asked the Islamic Development Bank to help his country conduct a second sovereign sukuk issue. He gave no details.
(Yahoo.News / 05 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Saturday, 4 July 2015

Islamic finance on bank's €475k training bill for taxpayer

The Minister for Finance, Michael Noonan, has confirmed a €1.7m bill to the taxpayer after officials at the Department of Finance, the Central Bank and Revenue took courses and training last year. Out of the 172 pursuing qualifications in courses funded by the Central Bank, only one was seeking a qualification in combating white crime with only one other sitting an anti-money laundering course.


The information was provided in a Dail response to Fianna Fail Finance spokesman Michael McGrath. He said yesterday that he would "support more resources being given to allow Central Bank staff to undertake specialist external courses in areas such as white collar financial crime prevention and detection".
Mr Noonan said the bill for staff at his Department who have completed courses in the current academic year totals €242,347 with an additional €27,782 spent on leadership/management programmes. He confirmed that the Revenue Commissioners' bill for staff taking courses totals €950,000 and this included a bill of €812,300 from the University of Limerick (UL) for 287 Revenue Employees taking a diploma in applied taxation and BA (Hons) in Applied Taxation.
Mr Noonan said his Department "continues to invest in staff development in order to supplement the skills and qualifications of our teams, through a combination of internal and external training, learning and development".

(Business Irish / 04 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Thursday, 2 July 2015

Germany's first interest-free Islamic bank opens in Frankfurt

Germany has opened its first Islamic bank representing a full range of banking services in accordance with the laws of Sharia. The Frankfurt-based bank, called KT Bank AG, is owned by Kuveyt Turk, the largest Islamic banking institution in Turkey.


KT Bank has also opened its affiliates in Mannheim and Berlin and plans to reach Cologne, Hamburg and Munich in the near future.
The Sharia law Islamic banks prohibit bank from charging interest on loans, as well as to take part in investments, especially those considered haram, like gambling, weapons, prostitution and alcohol.
Thus, Islamic banks do not provide customers with a mortgage; instead they buy a house and resell it at a higher price that already includes interest. Given the fact that the bank pays the tax twice – with the purchase and sale of the house – deals become much more expensive compared to those from conventional banks.
Among 4.5 million Muslims residing in Germany, 21 percent are ready to use the services of an Islamic bank, said the head of Kuveyt Turk Bank Kemal Ozan referring to a poll carried out by his company. However, Kuveyt Turk noted that it focuses not only on the Muslims living in Germany, but expects to approach the entire German market.
In 2010, Kuveyt Turk opened a small office in Mannheim, Baden-Wuerttemberg. In 2012 it appealed to the German authorities for a full banking license.
Istanbul-based Kuveyt Turk is one of the largest banks in Turkey and is part of Kuwait Finance House, which is mostly owned by Kuwaiti investors.
Islamic banks have already proved quite successful in the markets of England and France. UK housesfive Islamic banks and the Islamic Bank of Britain reported a 55 percent increase in deposits of non-Muslims over 2014. The bank associates these figures with the Barclays’ rate rigging scandal.
The UK has also become the first non-Muslim country to issue sukuk – an Islamic bond equivalent similar to a participation certificate. This type of bond is also utilized in Hong Kong, Luxembourg and South Africa.
(RT / 01 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Growing Demand for Islamic Finance Talent

The solid growth of the Islamic financial industry in the past few years has been underpinned by several factors, including improvements in regulatory clarity,

supportive demographic factors and product innovation. Indeed, from a USD0.8bln industry in 20091, assets in Islamic finance grew to nearly USD2tln in 20142 . Of these, 79% of assets are in the Islamic banking sector, while sukuk accounted for a 16% share.

Geographically, the Gulf Cooperation Council  (GCC) countries, the Middle East and North Africa (MENA) region and Asian countries accounted for a bulk of the industry’s assets. These regions have benefitted in part from favourable demographics and preferences for Shariah-compliant financial services.
Notably, non-OIC countries such as the US, Hong Kong and Luxembourg have also shown increased interest in Islamic finance, as these countries has issued debut sukuk in 2014. In addition to industry developments, growth in the past few years have been accompanied by evolving regulations, especially in key
Islamic finance jurisdictions. For example, Malaysia has enacted its Islamic Financial Services Act (IFSA) 2013. IFSA significantly strengthens the legal foundations that support a comprehensive regulatory and supervisory framework for Islamic finance and reflect international standards for effective supervisory systems. Elsewhere, several jurisdictions such as the UAE and Indonesia5 are in the midst of centralising Shariah functions in the industry.

Overall, recent developments in Islamic finance suggest that the industry is headed for deeper and more robust growth. Nevertheless, at the operations level, a key challenge for the Islamic financial institutions (IFIs) is to ensure adequate human capital supply to support various functions such as Shariah expertise and product development, as well as risk management, legal and information technology.
(Islamic Finance.Com / 01 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Wednesday, 1 July 2015

Qatar Islamic Bank raises 2 billion riyals with Tier 1 sukuk

Qatar Islamic Bank (QIB), the Gulf state's largest sharia-compliant lender by assets, has raised 2 billion riyals ($550 million) with a Tier 1 perpetual sukuk issue, it said on Wednesday. 


The sale was completed on Tuesday and was in accordance with Basel III banking rules, it said in a statement to the bourse. The issue will enhance the bank's capital adequacy ratios and support its business growth, it said.

QIB joins a string of Gulf banks which have tapped the debtmarkets in recent months to replenish their reserves after a period of strong lending growth.

In February, shareholders of QIB approved the issue of up to 5 billion riyals of Tier 1 sukuk.

Last month, Saudi Arabia's National Commercial Bank raised 1 billion riyals ($267 million) through a sukuk issue that enhanced its core capital.

(Al-Arabiya News / 01 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia: Islamic banking on track to meet 40pc of total financing target

Malaysia’s Islamic banking sector is on track to meet its target of 40 per cent of total financing by 2020, driven by the industry’s ability to continuously tap opportunities to finance the activities of the real economy.


Bank Negara Malaysia (BNM) Deputy Governor, Datuk Muhammad Ibrahim, said the continued progress of Islamic finance in the country would very much depend on the industry’s resourcefulness to build and maintain an innovative, competitive and inclusive Islamic finance industry.
“Furthermore, our continuous efforts to initiate cross-border regulators and industry, as well as between regulators and international bodies, would further expand cross-border activities given a steady and strong regulatory and supervisory framework already put in place,” he said.
Muhammad said this in his speech at the launch of Malaysia Islamic Finance Report 2015 today.
The report was launched in strategic partnership between CIMB Islamic, Thomson Reuters, the General Council for Islamic Banks and Financial Institutions and the Islamic Research and Training Institute.
Muhammad said from 2006 to end-2014, foreign issuers had issued sukuk amounting to an estimated RM28 billion in various currencies in the Malaysian marketplace.
“These indications showed that businesses are seeing the economic and business merit of Shariah-compliant products and services and that its appeal extend beyond the traditional captive market,” he added.
However, he noted that growth of the magnitude that Islamic finance experienced over the last decade would increasingly become more difficult if the industry did not continue to be nimble and agile in its approach.
Therefore, he said the key priority was for Islamic finance players to keep expanding and gain market share.
“Greater engagement and collaboration between the industry and academia would also ensure mutually-reinforcing efforts in driving innovation through the development and implementation of new research findings and breakthroughs,” he said.
(Malay Mail Online / 01 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Tuesday, 30 June 2015

Malaysia set to double sukuk sales

Islamic bond sales in Malaysia are set for the best quarter in more than a year as infrastructure firms take advantage of the lowest borrowing costs in 16 months.


State-owned DanaInfra Nasional Bhd. led companies in raising RM17.9 billion since March 31, compared with RM8 billion in the first three months, data compiled by Bloomberg show. The yield on Malaysia’s top-rated 10-year debt sank to 4.59% on June 5, the lowest since February 2014, and was at 4.61% as of June 19.
Sales this year in the world’s biggest sukuk market will probably climb to the highest level since 2012 as Malaysian companies tap a record RM625 billion of Islamic banking assets to fund Prime Minister Datuk Seri Najib Razak’s plans for more railways and roads, according to CIMB Group Holdings Bhd.
The top sukuk arranger in 2014 says companies will bring forward issuance to lock-in low rates before the Federal Reserve raises interest rates.
“The window to sell is between now and the end of the year,” said Badlisyah Abdul Ghani, the Kuala Lumpur-based chief executive officer at the Islamic banking unit of CIMB Group.
“We have a healthy pipeline of companies looking to tap the market this year.”
DanaInfra, formed to finance the country’s MRT project, asked bankers to submit proposals for a RM40 billion Islamic debt programme this month. SapuraKencana Petroleum Bhd plans to sell RM7 billion of such notes.
Najib, who is pushing for higher spending to help Malaysia achieve its goal of attaining developed-nation status by 2020, said in his October budget work will start in 2015 on projects valued at RM75 billion.
This year’s sukuk issuance could surpass RM70 billion, the highest since a record RM109.5 billion in 2012, according to CIMB and and AmInvestment Bank Bhd, Malaysia’s fourth-biggest arranger of Islamic notes.
RHB Capital Bhd., the top arranger this year, expects sales to be similar to last year’s total of RM65.1 billion as a slowing economy prompts companies to review their spending plans.
(The Malaysian Insider / 30 June 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

What happened to Islamic banking in Malta?

In the budget speech, the Government had announced the introduction of Islamic Banking in Malta. A year has nearly passed but there has been no word from Government about this initiative. In the wake of the terrorist attacks in Tunisia, Somalia, Kuwait and France, does our Government still intend to introduce this sort of financing? Does it still see it as beneficial or is it now perceived as a threat? Without any doubt the introduction of Islamic Banking will be a challenge to our young democracy.  

To my knowledge, there was no legislation in this regard, even if, one cannot exclude that it is being quietly carried out by one of the private banks. Introducing formally such a new financial service is going to be a challenge for Malta and this is irrespective of IS terrorists attacks or not. The budget speech lacked information about this financial mechanism, which is highly provocative in structure. No one was expecting details during such a speech, as budgets are there to outline policy. But nothing else was heard, at least, in the open.
Definitely, my assessment about the introduction of Islamic Banking is that should this happen, it is going to be a challenge to both Government and the Opposition. There can be no doubt that the Government looked at the matter from a purely commercial point of view without paying any attention to certain core values. These were simply ignored as is only too often happening these days. But the attacks by ISIS are bringing the issue of core values to the fore again. This is not only relevant to Islam but also to the Western world.
Possibly, the Opposition thought that if it decided to oppose it and question Government, it risked being faced with an accusation of being negative and of hindering Malta’s further expansion as a Financial Centre. One needs to remember that Malta’s development as an International Finance Centre had never been the source of political controversy and the PN received all the support from the then Labour Opposition. At least, this was a point, which both John Dalli and the late Lino Spiteri agreed on.
I am sure that any negative approach by the PN to Islamic Banking once it is implemented would provoke an easy spin for Government to put the PN on an off course. The simple argument would be that if Islamic Banking is acceptable in the UK, then what's wrong with Malta? Well, maybe we ought not to compare Malta with the UK but even the UK is starting to question a number of core values and accommodating policies to Islam.
But do we need to take the UK as a model? One needs only to remember that the Muslim community in the UK is now 4.2% of the population. There are streets in the UK where Sharia law reigns ‘unofficially’ supreme. It has been unceremoniously introduced by Muslim residents. British, non-Muslims and moderate Muslims now fear to enter a number of Muslim areas.
The UK is now starting to debate whether it is time for the introduction of the Islamic inheritance system, which bluntly discriminates against women, and is all in favour of men. In other words, if this is done, the UK will be going back to the Middle Ages, when the feudal system reigned supreme. In Quebec, Muslims are also demanding the introduction of Sharia Law and the secular state is in difficulties not due to principle but as those protesting are being financed by America’s Arab friends.   
On the other hand, should the PN publically endorse Government’s proposal, would it be seen by the rank and file of the Party to be compromising its core values and principles? Perhaps this explains its silence on this issue. It is here, where Government and Opposition need to tread with care but it is about these points that the PN Opposition should be pressing and concentrating. Allow me to explain this by making a few observations.
Currently Malta is seen as one of the top countries in the fight against money laundering and terrorism funding (see for example the Basle AML index). With the introduction of Islamic Banking, the biggest preoccupation would be whether such a position would be negatively affected. Definitely, if Islamic Banking is introduced, we (as a country) must put in place strong safeguards against financing terrorism. Is the Government really ready to take up such a challenge? Has it got the means?
As a Financial Centre and following the introduction of Islamic Banking, does Malta run the risk of being downgraded in the perception of the international community? Perhaps one would argue that England has introduced Islamic Banking and apparently, it remains a world centre of Finance, but the way that Cameron is reacting to migration points to a change of policy. 
My other concern is on the role of the Regulator. I am still at a loss on this. Despite a long Budget Speech, such an essential issue was not tackled by the Minister of Finance. I do not consider that I will be throwing any bad light on the institution if I say that MFSA is far from being prepared for such a proposal. But there again, should MFSA be the Regulator? The recent controversies into which MFSA was dragged in relation to money funds that had gone astray and the answers given by the same MFSA leave much to be desired as well as to the reality of how well equipped and well prepared is such an Authority to act as Regulator. Can this institution guarantee that our good reputation in the banking sector does not go amok thanks to the introduction of Islamic Banking? I have some misgivings on the matter.  
(Malta Independent / 29 June 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Monday, 29 June 2015

Islamic banking in Uganda

It was not making sense that Ugandans were denied this option to access financing under a different culture.

The most striking thing about strict Islamic banking is the sharing in profit and loss. The customer is never made to feel that they have been victimised in any way.
There is also the Arabic concept of Musharaka and Mudaraba in that the banks share in the risk and future profits of a promising project. This means they stick with you all the way.
I am not saying the western style commercial banks are bad. Simply that in this day and age, having as much options to choose from is good for business people. With Islamic banking, Uganda can now hopefully be of more interest to the larger banking names in the Middle East and Gulf States.
I suspect that there are those who have concerns about Islamic banking due to its roots in the Shari’ah law. It is true that some terms are stricter compared to conventional banking, but this is so that no one is unecessarily penalised. It all boils down to  removing the burden of interest or Riba and reducing uncertainty (Gharar) to promote economic activity. It sounds confusing, it is a worthwhile alternative to explore.
(Business Week / 28 June 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com
Upcoming Events on Islamic Finance, Wealth Management, Business, Management, Motivational Alfalah Consulting, KL-Malaysia: www.alfalahconsulting.com