21 July 2011

Nigeria: Why Women Should Embrace Islamic Banking - Group

Abuja — In a bid to boost the nation's economy, Nigerian women have been charged to embrace the non interest banking otherwise known as Islamic bank.

The national president of Federation of Muslim Women's Association's in Nigeria (FOMWAN) Hajia Mariam Othman who gave the charge at a one day Awareness Talk on Islamic/Non-Interest Banking Wednesday in Abuja said the new banking system would mostly favour women who needed loan to start up a business.

The group said the only difference Islamic bank had from other commercial banks was the fact that it is operated without interest rate, while the banker shares profit and loss with the customer.

Mrs. Othman noted that in this contemporary time, it has become impracticable for women to have access to funds from commercial financial institutions to create and expand their businesses adding that in most cases, women were disqualified due to their inability to fulfil rigid lending criteria.

According to her, "this system is not centred only on credit worthiness and ability to repay the loans and interest; instead, the worthiness and profitability of a project are the most important criteria of Islamic financing while the ability to repay the loan is sub-segmented under profitability.

"This means that women who have hitherto been virtually excluded from accessing loans and professional financial advice due to weak capital base now have a chance to be assessed on the merit of their idea and its usefulness to the society", she added.

She said the forum was convened with the sole purpose of enhancing their knowledge, providing answers to the many questions that has been asked regarding the new system as well as correcting misconceptions on government's new policy on Islamic banking.

The forum is also expected to provide an avenue for understanding the principles of Islamic banking, its modus operandi, its accessibility, and viability to all manner of persons and its indispensability to the well being and eternal salvation of the Muslim.

Urging women not to be too emotional about the new banking system given its name, Dr. Bashir Umar Aliyi, special adviser to the Governor of Central Bank of Nigerian (CBN) on Non-Interest banking said the system framework was necessitated by the effect of global economic meltdown that adversely affected the Nigerian financial institutions and slowed down the growth of the economy.

Speaking on the paper titled "Fundamental Principles of Islamic Finance", Dr. Aliyu said based on the Islamic rules and regulations, the Islamic bank forbids whoever seeks to access its loan to use it to establish brewery, casino or any other business that is purely against the tent of Islam adding that with such a system in place, Nigerian economy will witness a speedy turn around.

According to him, "Islamic banking as one of models of non-interest banking provides financial services similar to conventional financial institutions save that it operates in accordance with principles and rules of profit and loss sharing and the prohibition of interest charges.

The Islamic banking system is estimated to be $1.0 trillion of global industry, and that the rating agency, Moody has forecasted that the industry could hit $5 trillion overtime", he added.

Also speaking at the event, President of Catholic Women Organisation (CWO) FCT chapter, Mrs. Theresa Ajwa said the new banking system has nothing to do with religion despite the name.

According to her, "from what I have come to know about Islamic banking, it has nothing to do with religion, it is a welcome development and it will be more favourable to our women and youths".

Copyright © 2011 Daily Champion. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.