6 September 2010

Tanzania: Stanbic Bank Widens Shariah Banking

Dar Es Salaam — Stanbic Bank Tanzania limited is seeking to widen its Shariah banking facility following a positive response to the bank's May 4h, 2010 pioneering initiative in the Tanzania financial market.

The Managing Director of Stanbic Tanzania bank limited, Bashir Awale said last week during at Iftar function at the Movenpick Hotel in Dar es Salaam: "We have recently submitted a proposal to the Bank of Tanzania (BoT) to widen the scope of Shariah banking to bring Shariah banking closer to our customers." This will be in addition to other Shariah banking products such as Shariah current account and debit cards which allow holders to access their savings at Automatic Teller Machines (ATMs) worldwide."

However, he said it was too early to tell when the BoT would respond. Stanbic bank was the first commercial bank to launch Shariah banking in Tanzania, and was followed immediately by the National Bank of Commerce (NBC).

Mr Awale said Stanbic bank was determined to keep improving on the Shariah banking scheme to pave the way for more Islamic members of the community to utilize the products that are compliant with the Islamic principle of prohibition of payments or acceptance of interest fees on savings or borrowing. However, he said even non-Muslims were welcome to open Shariah banking accounts.

"To date the bank has opened over 5,000 Shariah accounts. We began slowly with about 50 people opening an account per week. We are now opening about 500 bank accounts per week." Sharia banking "is a system of banking that is consistent with the principles of Islamic Law which prohibits the payments or acceptance of interest fees for the lending and acceptance of money," he said.

The Stanbic bank boss said his bank was planning to increase its branch network to cover all major regional towns, in phases, and install more Automatic Teller Machines (ATMs) across the country to bring banking services close to customers.

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