Managing Director, Islamic Banking and Finance Institute Nigeria, Sani Aminu Dutsinma has said that Islamic fi nance industry has expanded in the last decade, growing by 10 to 20 per cent annually.
Dutsinma who disclosed this in Lagos at the sensitization workshop on ” the Fundamentals of Islamic Economics, Banking and Finance.
” He said shariahcompliant fi nancial assets estimated at $2 trillion, covering bank and non bank fiancial institutions.
He stated that Islamic banking assets have been growing faster than conventional banking assets and there has been an increased interest in the industry from countries like United Kingdom, Luxembourg, South Africa and Hong Kong.
In sub Saharan Africa, he said that South Africa led the way with one of the largest international Islamic banking conglomerates – Al-Baraka Banking group.
He also argued that the economic activities of human kind cannot be divorced from the ethical position a per son takes, and this conditioned by religion the person professes.
Speaking further he said ” an understanding of religious teachings help help to put ethical issues including those involving economic relationships in a fuller perspectives.
Dutsinma said it is high time Nigerian Policy makers recognised Islamic fi nance, stressing that such recognition can signifi cantly contribute to economic development, given its direct link to physical assets and real economy.
He further explained that the use of profi t -and -loss-sharing arrangements encourages the provision of fi nancial support and generates jobs, adding that emphasis on tangible assets ensures that the industry supports only transactions that serve a real purpose, thus discouraging fi nancial speculation.
He said that Islamic fi nance can as well helps to promote fi nancial sector development and broadens fi nancial inclusion, by expanding the range and reach of fi nancial products.
He said apart from helping to improve agricultural fi nance, contributing to improved food security, Islamic banking help to improve fi nancial access and foster the inclusion of those deprived of fi nancial services.
He however said that Islamic fi nance canvasses for partnership style fi nancing which could be useful in improving access fi nance for the poor and small business.
Also speaking, a senior lecture, Faculty of Law, Lagos State University, Dr Olatoye karim said that there is a lot of diff erences between Conversional banks and Islamic banking .
He explained that Islamic banking does not have the right to impose charges on a customer who defaults in loan payment.
He said under Islamic banking practice it is better for the bank to pardon and forgive the loan defaulters instead of penalising them.
He however said that economic fi nance encourages assets fi nancing on commodity trading.
