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Monday, 27 October 2008

Kenya: Banks urged to introduce Shariah compliant products

Chief Kadhi Sheikh Hammad Kassim has challenged banks in the country to introduce Shariah compliant products to benefit the Muslim clients in the country.

Sheikh Kassim said the interest based banking system that is practiced by most contemporary banks has not benefited savers over the years, with many Kenyans ending up losing property after failing to pay accumulated interests on loans.

"In Islamic banking, it is on mutually pre-agreed terms between the bank and the customer with no interest charged on the principal amount, but only a profit for the institution" he said.

He said Islamic banking with Shariah compliant products is beneficial even to non Muslims, and challenged banking institutions to promote these products which have assisted millions of muslims worldwide.

He was speaking at the Mombasa branch of the Imperial Bank the winners of a competition who had opened accounts with the bank's Shariah compliant Imani account were awarded with various prizes.

He regretted that before the introduction of Shariah compliant banking, many Muslims who could not do business with the interest based banking system because it is against their religious beliefs preferred either to keep their funds at home which is risky or banked in current accounts which did not earn any profit for them.

Sheikh Kassim said Islamic banking is not a new concept as it is successfully being practiced even in the developed world, and Asia.

Nominated Member of parliament Sheikh Mohamed Dor who was present said banks that embrace Islamic banking concepts suffered no losses unlike the interest based banking systems.

Imperial Bank's area manager Assad Ahmed Hassan assured both Muslims and non Muslims that the bank's products were compliant with the Shariah law and urged them to open the accounts with the bank so as to benefit from loans and other services.

"The larger community in Kenya has not been adequately catered for and the introduction of the Imani account is the first step for the bank to reach out to these clients with a product that is fully compliant with their religious beliefs", he said.

Imani account is a unique Islamic banking account that provides an ethical banking alternative specifically designed to be Shariah compliant, and is an interest free demand-deposit account which is practical and highly responsive to the modern financial needs of the market.

The first prize in the competition which commenced on December 1 last year upto September 30 this year is a fully paid trip to Mecca worth US dollars 3800, and was won by Hajj Abbas Ali Abdulrehaman from Malindi.

The second prize, a 47 inch television set was won by Ibrahim Mohamed Hajj of Mombasa while the third prize was won by Hamed Athman Fumo of Mombasa.

231 customers of the new Imani account participated in the competition, with other winners being awarded various prizes including television sets, mobile sets and other goodies.


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