Abuja — The Central Bank of Nigeria said it will soon release its final regulatory and supervisory framework for the effective operation of non-interest or Islamic banking in Nigeria.
Speaking at a two-day workshop for Business Editors and Finance Correspondents organised by the Nigerian Deposit Insurance Corporation in Bauchi State, Special Assistant to the CBN governor on Non-interest Banking, Dr. Bashir Aliyu Umar, said the Islamic Banking sector worldwide, had grown at a stronger rate of 15-20 per cent annually over the past decade, from about 150 billion dollars in the mid-1990s to an estimated 780 billion dollars in 2009, adding that its assets are expected to grow by more than 20 per cent to 950billion dollars in 2010.
In his paper entitled:"Islamic Finance In Nigeria: Issues And Challenges," Umar said, "So much interest has been generated in Islamic Banking globally because of its phenomenal growth within a relatively short span of time and more especially as an aftermath of the recent financial crisis.
"On a regional and sub-regional plane, several countries are struggling to become the hub of Islamic Finance in the African continent or the West African sub-region or at least to become pioneers in the field. On the national scale, market operators including banks and insurance companies and asset management entities are busy exploring this alternative financial model and its potentialities, and most recently, regulators are gearing up to the role that they have to play in regulating and supervising this innovative financial service industry, whose entry into Nigerian economic arena is only a matter of time."
Shedding light on the banking model, he said it is a financial system that is based on adherence to the Shariah or Islamic law and offers services, products and instruments based on compliance to the divine law, adding that its mode of finance involves the transfer of assets and are not based on making money from money alone as is the case with interest-based transactions.