Islamic banking: Whither Nigeria
NaijaRock
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Posted by Felix Okoli on July 06, 2011 at 06:48:24:
While as a Nigerian, I won't say there is anything wrong with having an Islamic bank, Christians and others who are against Islamic banking in Nigeria do have a right to protest against it. One question though, "Is islamic banking contrary to the Nigerian constitution?". Since Nigeria is a secular state, one may be a bit confused as to why the Federal govt and the CBN gave an approval for the establishment of an Islamic bank. Of course we have Muslims in Nigeria as well as Christians, but is it really ok to approve the establishment of a bank that is publicly Islamic? What does our constitution say about govt giving public support to religious institutions? Is this right? If it is right to approve and give license to an openly Islamic bank, in the near future it may also be seen as ok for the Federal govt to give license to Islamic political parties and I don't see why not.
Although for long, the Federal govt has been granting approval Islamic and Christian schools, universities, places of worship, groups and Non Profit organizations, with the approval of Islamic banks in Nigeria, it is really history in the making and we don't exactly know the final outcome of this. For many years and even during the days of Military rule, the talk about having a political party that has a religious or even ethnic name would never be registered since these were seen as being divisive to the Federal republic. But if Nigeria is really going to have an Islamic bank, some of the things we need to ask are:
- Will it be a Non Profit organization?
- Will the govt keep supporting and funding them?
- Will shares be open to the public?
- Will it be open and fair to Non-Mulsims?
- How will it continue to operate without charging interest?
- How will Christians react?
- Will Muslims really patronize it given there is no interest on savings?Most Christians in Nigeria really have nothing against Non Interest Banking (NIB) but they would really find it hard to accept the idea of patronizing a bank that bears the title Islamic as it would seem to be a betrayal of their faith and this may not help the spread of Islamic banking in Core Christian states in Nigeria. Perhaps, the time may also be ripe for such a bank in Nigeria as more Muslims in growing cities are feeling the need to publicly declare their faith in the little things they everyday.
Well, there is really nothing wrong with having an Islamic bank but it may cause tension in a multi-religious country like Nigeria and It won't be surprising if in a short while we start having other banks spring up that will follow suit based on religion, tribe or region. We may even have a Christian or Yoruba, Igbo or Ijaw bank soon and really, they won't be anything technically wrong with the CBN granting an approval for that too.
Comments:
While as a Nigerian, I won't say there is anything wrong with having an Islamic bank, Christians and others who are against Islamic banking in Nigeria do have a right to protest against it. One question though, "Is islamic banking contrary to the Nigerian constitution?". Since Nigeria is a secular state, one may be a bit confused as to why the Federal govt and the CBN gave an approval for the establishment of an Islamic bank. Of course we have Muslims in Nigeria as well as Christians, but is it really ok to approve the establishment of a bank that is publicly Islamic? What does our constitution say about govt giving public support to religious institutions? Is this right? If it is right to approve and give license to an openly Islamic bank, in the near future it may also be seen as ok for the Federal govt to give license to Islamic political parties and I don't see why not.
Although for long, the Federal govt has been granting approval Islamic and Christian schools, universities, places of worship, groups and Non Profit organizations, with the approval of Islamic banks in Nigeria, it is really history in the making and we don't exactly know the final outcome of this. For many years and even during the days of Military rule, the talk about having a political party that has a religious or even ethnic name would never be registered since these were seen as being divisive to the Federal republic. But if Nigeria is really going to have an Islamic bank, some of the things we need to ask are:
- Will it be a Non Profit organization?
- Will the govt keep supporting and funding them?
- Will shares be open to the public?
- Will it be open and fair to Non-Mulsims?
- How will it continue to operate without charging interest?
- How will Christians react?
- Will Muslims really patronize it given there is no interest on savings?Most Christians in Nigeria really have nothing against Non Interest Banking (NIB) but they would really find it hard to accept the idea of patronizing a bank that bears the title Islamic as it would seem to be a betrayal of their faith and this may not help the spread of Islamic banking in Core Christian states in Nigeria. Perhaps, the time may also be ripe for such a bank in Nigeria as more Muslims in growing cities are feeling the need to publicly declare their faith in the little things they everyday.
Well, there is really nothing wrong with having an Islamic bank but it may cause tension in a multi-religious country like Nigeria and It won't be surprising if in a short while we start having other banks spring up that will follow suit based on religion, tribe or region. We may even have a Christian or Yoruba, Igbo or Ijaw bank soon and really, they won't be anything technically wrong with the CBN granting an approval for that too.
Comments:
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Re: Islamic banking: Whither Nigeria
Posted by Usman,Idris
on July 21, 2011 at 06:47:18:
I SEE, I BLIEVES SUCH SYSTEM IT SHUOLD BE ALLOWED.
Re: Islamic banking: Whither Nigeria Posted by karim on August 13, 2011 at 21:20:50: If you want the latest news form Nigeria financial environment, i must recommend this website i came across today. http://www.easykobo.com
Re: Islamic banking: Whither Nigeria Posted by taibu on August 15, 2011 at 07:43:42: I have an article that will adress some of your questions regarding the capital base of islamic banks and if they are non profit and how do they work. this article was taken from www.easykobo.com
June 22 (Lagos) - CBN has set a minimum capital requirement of N 10 billion (63.9 million) for a national Islamic banking license. For regional Islamic bank license, the capital requirement has been set at N 5 billion
June 21 (Easykobo.com) CBN Governor, Lamido Sanusi said that Jaiz Bank had been approved as the nation's first Islamic bank. Jaiz bank has six months to comply with the central bank's terms to the the final license. He also that the CBN is planning to issue a first sovereign sukuk bond with-in the next 18 months. No further details about the size were provided. There is a lot of discussion about this in the banking sector. Market is not clear about the direction this will take. A dealer told easykobo over the phone that "it is not about the religion but about the fears that established banks will face competition from a new type of lender". Such ambiguity on the subject is making investors nervous on banking stocks and that has added to the already damp sentiment at the NSE. The NSE main index closed lower by 0.91% today. Thats 9 straight days that the NSE was closed lower. Falling oil prices, increase in inflation, weakening Naira and worsening security situation in the country are some other factors affecting the market sentiment.