NAIROBI – The recently offered Islamic banking in Nairobi is attracting new customers from Muslims and non-Muslims alike who praise the growing industry for offering low-risk Islamic shari`ah financial solutions, UPI news agency reported on Friday, November 25.
"Now, I don't have to worry about accumulating riba," Ahmed Bayusuf said, using the word that, for Muslims, defines interest.
Developing in his work over the past decade, Bayusuf used to work as a cab driver in Nairobi for nine years.
After saving enough money, he invested in a coffee shop. Now, he's the store manager at Books First.
In 2007, Gulf African Bank and First Community Bank offered Nairobi's first interest-free banking options, in accordance with Shari`ah.
Now, there are nine banks offering interest-free options.
Other services that attract customers include free accounts with minimal opening fees, no ATM fees, no maintenance charges and flexible loan payments.
Offering low-risk investments, Islamic banking is appealing to Muslims and people of other faiths as well, Bayusuf said.
He added that he thrilled for having an opportunity to invest his money in Muslim-approved accounts.
"I also know that my money is being invested in compliance with the Islamic way," he said.
There are nearly ten million Muslims in Kenya, which has a population of 36 million.
Muslims make up nearly 98 percent of the communities of the North Eastern Province.
Showing a growing preference for Islamic banking, analysts expect a bright future of Islamic banking.
“The industry has transformed the banking sector," Abubakr Athman, a business analyst with TalentRecruit Kenya Limited, said.
"Many conventional banking customers have flocked into Islamic banking, clearly seeing the benefits on offer."
Islam forbids Muslims from usury, receiving or paying interest on loans.
Transactions by Islamic banks must be backed by real assets, not shady repackaged subprime mortgages.
Shari`ah-compliant financing deals resemble lease-to-own arrangements, layaway plans, joint purchase and sale agreements, or partnerships.
The Islamic banking is one of the fastest growing financial sectors in the world.
The system is being practiced in 50 countries worldwide, making it one of the fastest growing sectors in the global financial industry.
A long list of international institutions, including Citigroup, HSBC and Deutsche Bank, are going into the Islamic banking business.
Currently, there are nearly 300 Islamic banks and financial institutions worldwide whose assets are predicted to grow to $1 trillion by 2013.
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